Garret (00:01.88)

Grant Shipman, welcome to my podcast studio.

The Coliving Guy, Grant Shipman (00:05.071)

It's really an honor to be here, Garrett.

Garret (00:08.148)

Thank you. So I actually reached out because you have a very compelling story and I love learning new things about real estate. But that's more of a teaser. Why don't we start with the normal podcast intro? Why don't you tell the audience a little bit about your background?

The Coliving Guy, Grant Shipman (00:21.57)

Hehehe

The Coliving Guy, Grant Shipman (00:27.606)

Yeah, I, um, so...

my background, I was kind of that Jack of all trades, right? Master of none, which was frustrating until I read Rich Dad Poor Dad, right? And I learned the rest of the quote, which was Jack of all trades, master of none, but often much better than a master of one. And I just loved that because what I learned was, hey, if I am good at a kind of good at a number of things,

together and they can enjoy their specialty and I can enjoy my specialty which is coordinating people. I love communities so as far as how things kind of ended up that I accidentally had you know 20 years of co-living experience

that would end up playing a huge role in real estate. I mean, it just, it's not a surprise, but it's nothing I saw happening at the time. It's just something that I really enjoyed. And so my background, kind of finding co-living by accident, and then 17 years later, finding that, wow, this is really an accelerant to what I wanted to do with real estate and playing a role in my life.

Garret (01:48.356)

Okay, we'll back up for a little bit. I mean, where are you currently located?

The Coliving Guy, Grant Shipman (01:54.506)

Yeah, yeah, thanks. So I live in Estes Park, which is about an hour away from Denver up in the mountains. If you go to Rocky Mountain National Park, you go through Estes Park, the city.

Garret (02:06.552)

Very nice.

The Coliving Guy, Grant Shipman (02:06.786)

It's a little town of 5,000. Yeah, I grew up in Iowa and kind of everybody dreams of retiring to Estes Park, which is my parents did that. And so we wanted to have babies, my wife and I. And so four years ago, we moved to Estes Park. We just started, I'm at my winter house in El Paso because Estes Park is beautiful, but the winter just keeps hanging on. So last year we got this house in El Paso

friends down here and we're enjoying the heck out of it. So that's where I'm at and yeah as far as you were saying with bio I just get I'm like oh wow what's exciting oh wait is for me what I do is I wanted to be a father and I had a number of businesses and they weren't

they weren't, they were paying my bills, but there's no way they could pay the bills of a guy who I wanted to have kids, a family, and the schedule and the finances to enjoy them. And so I found myself kind of accidentally in co-living real estate investing and it's great. I, like my house in Estes, I've got my parents there, family, all of that stuff. And I work about three hours a week and my staff does all of the stuff.

And it's, you know, like you know, Garrett, the magic of real estate, you provide homes and value to people that's really huge in comparison to the amount of work that you do as long as it's smart work.

Garret (03:45.4)

you know, I was smiling when you said winter keeps hanging on because I don't know if you did your research on me, but I'm up here in Manitoba, Canada, right in the Howling Prairies. And yeah, well, although there is something that we keep hearing, you know, our weather people keep saying, oh, there's a Colorado low that's coming through. So which usually means tons and tons of snow followed by freezing cold temperature. So I don't know if that's from you guys, but thank you.

The Coliving Guy, Grant Shipman (03:52.569)

Yeah, I need to shut up.

The Coliving Guy, Grant Shipman (04:06.033)

Hahaha

The Coliving Guy, Grant Shipman (04:13.991)

Yeah, you're welcome. Yeah, I need to eat my words, because right, like we got nothing on you guys. Ha ha ha.

Garret (04:20.655)

No, it's all good. All good. No. Yeah, in all seriousness, why don't you kind of go through I like to know that and say that sort of our backgrounds kind of make we who are make us who we are. Why don't you tell us a little bit about your educational background and how that's kind of shaped your direction and where you're going today.

The Coliving Guy, Grant Shipman (04:38.89)

Yeah, so just to start where I'm going, like where I am in 2017.

I started a co-living investment in property management company. And it just made sense at the time. But where that all came from was in 2020, I ended up moving into a first, a shared living environment. So co-living, it's been called lots of things, right? Intentional living, co-housing, community living. But I ended up moving into one of those just because I liked people.

And it was cool to see the different ways that these communities, I mean, these communities have existed for hundreds of years. And they are not the way most people experience, like, oh, I had roommates once, or I had... I had...

I lived in a rent by the room situation, right? This is something nobody wants to have that unless they can, if they can afford otherwise. But I moved into this and I just, I realized, wow, like, I always wanna live with others as long as the benefits of that.

like outweigh the cons, right? There's a healthy system in place where I can feel stable but free to be myself. So I moved into that. My only official, as far as college training, is a four-year BA in psychology.

The Coliving Guy, Grant Shipman (06:11.658)

Did this help me at all? I don't think so. To do again, I would have done business. This was at a time where they didn't realize the brain was plastic, so it was all about diagnosis and drug, and it just didn't appeal to me. But I did get a college degree. That was important to my parents. I went on to be a college pastor. I really liked that. That was all community driven. If I look back, the thread of my life has all been understanding community dynamics. How can it be where people wanna be together,

enjoyable. So I was a college pastor then after that I was in Austin and I discovered the yoga and specifically the Acro Yoga community which is a form of partner yoga and acrobatics and you can't do it with some with by yourself that's just how it is so a group of a hundred plus would be Friday, Wednesday all throughout the week classes

And that's this was kind of like the healthy nightlife the healthy life people are doing acrobatics that you know the year before They were sitting overweight at a desk job, right? And now they still have that desk job, but they're in the best shape of their life But it's not because they're working out it's because they're just excited to you know balance somebody on their hands so that was all community driven and

And so as far as my background goes and how things happened, you're 100% right. Like it made who I am, but at the same time, it just seems like I was following a track that I didn't know I was even following, right? I was just making decisions in the moment that I thought was the best at the time.

Garret (07:50.604)

You know, you say that your degree was, didn't really help you and you regret it. My listeners know that I have a science degree. I was in a PhD. I dropped out six months before I was gonna graduate. I now have a master's in molecular biology. People ask me that all the time. Do you have any regrets? Because I used to say the same thing that you just said. I wish I had gone to business school. And don't get me wrong, I wish I still had because I struggle sometimes in the running of my businesses, but.

The Coliving Guy, Grant Shipman (07:56.066)

Ha ha.

Garret (08:20.02)

something that you said resonated with me because relationships, right? I would challenge you to say that what you learned in your degree was relationships and how to manage those relationships and now getting onto communities. So can we maybe define for the audience maybe a classical definition of co-living and then we can kind of explore the different types?

The Coliving Guy, Grant Shipman (08:24.887)

Mm-hmm.

The Coliving Guy, Grant Shipman (08:44.206)

Hmm. Yeah, I, um, so.

And this is really good because the co-living term, it's a young industry in a sense. In another sense, it's a very old industry. It's actually been a multi-billion dollar industry in the world since around 2003. And, but as far as being young and still using terms. So before it's been known as co-housing, intentional communities, all of these things, where co-living rose above

other terms. So to give this a definition is that when a unit, a living unit, whether it's a house or an apartment, anything like that, which would normally have a platonic family in it or a group of friends that just signed a lease together.

that this is shared by multiple independent adults. And so it'd be people who would otherwise be living alone or renting a room now are sharing a living unit and they create, don't think like a co-op or a commune, that's a different idea, but they create kind of a non-traditional household. So as far as co-living goes, it's not short-term rental, it's not an Airbnb house.

It's not an extended stay hotel. It's not a rooming house. This is something where people, they're living there in part because they want to live with others that they respect and appreciate. And at the same time, they're not sharing a lease with those others, nor are those others, their family are married to. Although, I mean, that of course can happen sometimes we have couples move in, but this is a nontraditional, not like a blood-related family.

Garret (10:39.612)

Okay, so you said it's not a rooming house, but I mean, at least by my definition, people who are renting a room might share a bathroom, might share a kitchen. That sounds like a rooming house. And yet you're saying it's, it's intentionally not. Can you explain?

The Coliving Guy, Grant Shipman (10:51.303)

Alright.

The Coliving Guy, Grant Shipman (10:55.562)

Yeah, and this is, there's some nuance there as far as talking about it. When you show up to a place, you can really understand it. And if you don't mind, I'll kind of back up because as far as, yeah, real estate investing, and to tell you, Garrett, I struggled with communicating this message because,

Garret (11:12.289)

by all means.

The Coliving Guy, Grant Shipman (11:22.434)

uh, most people, I think most is correct. Most people hear it and they think rooming house, or I've heard about that. It's rent by the room.

And what that automatically means, particularly when you're thinking about return on investment, is that it's not worth it. We have high turnover, high tenant conflict, high property damage. So the revenues might be higher each month, but the bottom line, the profit is not higher and the stress is not worth it. So people think about college housing, senior housing, all of these things. So there's that confusion. So I think I'm going to try out.

tell me if this I'm communicating it better is if we take a single-family house usually if this is traditionally rented out long term it's on a six 12 month or longer lease and it's on one lease so that one house is on one lease

That house could be rented out as a short-term rental also Now these rentals are less than 30 days apiece But it's still one house that same house with one lease at a time. The leases are just shorter in duration This also would fall into say midterm rental maybe three to six months Still one lease one house, but if we take that same house

and we put a lease on each bedroom. So in a sense, it's a rent by the room, which is a similar rental strategy. Then it becomes.

The Coliving Guy, Grant Shipman (13:00.446)

a rent by the room that person is responsible only for their lease but that house same house has now say five leases on it or six or seven leases Our smallest house has four bedrooms. So that would have four leases on it Now to that makes it a rooming house or a rent by the room. What I would say is the nuance with a co-living house Is that this is a place where people want to stay a long time?

renter is there for over two years. Some have been there for five plus years. Where and this is this is where the big difference is as far as saying what is co-living compared to what is rent by the room or a rooming house. Rent by the room, rooming house, boarding houses, these play an incredibly important role in society because there are people that need temporary places to stay. They cannot afford other places typically.

Garret (13:33.358)

Wow.

The Coliving Guy, Grant Shipman (14:00.467)

and it provides important, very important housing. But to confuse that with a household that is really just like, you know, another single family house or single family apartment.

However, it's people who are living there because they truly want to. Now, maybe they value saving money without a doubt, but they're living there. Like so for when I moved into a co-living house, it was eight people down in Austin. And this is an example of I wanted to live with people. It just happened that one gal's mom was sick and so she was gone a lot. Another guy, Bruce, his band was really taking off, so he was gone a lot.

house alone a bunch of the time and I thought well this is not serving my purposes I still had the same low cost in Austin near downtown $400 a month right that's incredible right fixed rate utilities yay but a co-living house the intention would be hey I'm gonna move in I don't need best friends I don't need brothers or sisters I don't need people to support me I don't want to live with a bunch of my college roommates or a 55 year and up community I

place that has like people I respect and appreciate that we share the same roof. And if you would walk into it you would say, oh man this is this is a nice place I like this. People are always shocked when they come in if they see if they hear eight people live in this house right but eight people live in houses all the time they're just usually related and if that household is run well then that house is clean it smells nice the lawn looks good all of those things.

Hit me, I mean, I'm sure I left some things out or was confusing. That was my best try. How was it?

Garret (15:48.796)

I am writing down questions. You can see that. So, okay, let me, let me start here. So co-living, and I look this up, and you see things like rooming houses, sobriety houses, even some, I guess, extreme halfway houses. But what you're talking about is people who want to don't want to live alone, who want to live with like minded people.

The Coliving Guy, Grant Shipman (15:51.074)

hahahaha

Garret (16:19.668)

How are you matching those? Is it the property manager's job? I mean, I have so many questions.

The Coliving Guy, Grant Shipman (16:22.242)

Hmm.

The Coliving Guy, Grant Shipman (16:25.786)

So yeah, that is, I mean, I'm telling you, I'm glad you asked that question because it is spot-on what I get asked the most. And it actually there was a It's kind of like e-harmony in the sense of people think hey if I live with the right people I will be successful. However

A lot of people have lived with roommates or a brother or a cousin or something that they get along with great. Actually, they might be incredibly similar with and they have a terrible shared living experience. So how do we do it? And this is a you, as far as I know, I've worked hard to understand the co-living world in the US larger than that.

and there was a company named Oli. And Oli had this software, let me look here so I'm given exact information. So Oli was started in 2012. They had $15 million funding, total funding. I mean, it was a big deal. And they had this specific software.

that matched the right people. However, in 2020, when households like mine that practiced a different way of, or sorry, co-living houses that I ran that practiced a different way of doing it, we thrived during the pandemic.

Ali suffered terribly, so much so they were going to close, but they got acquired by another company named Starcity. Starcity valued this idea of pairing up the right people with each other. Let's put all the teachers together, or let's put the extroverts together, or let's whatever.

The Coliving Guy, Grant Shipman (18:17.242)

and Starstee also then let's see they were acquired by common the next year this doesn't work and I actually I felt like when I you know, I'm this little company right like Starstee was a 50 their total funding was fifty point three million dollars and they were started in 2016, right so massive money massive staff massive research

And what I was seeing is they were not talking about a thing that I have experienced is the most important in co-living And so what I said is I go I don't think these companies are gonna exist like in time I Don't see how they can unless they are talking about this x-factor and I'll share that in a moment

but they're, I mean, I'm sorry, they are using this X factor, but they don't talk about it on their websites or I would call them up and ask about things. And so, I'm Garrett, I'm kind of circling around your question of how do you match these people? And are what we have found to work literally 100% of the time,

is instead of looking at finding the right people and pairing those people up with the right people, what we do is

we have a 40 point household system. We look at what is a healthy household, meaning a household you wanna live in is one that's stable enough that you feel safe, you feel comfortable, right? The things aren't changing all the time. At the same time, it's not, there's plenty of things that are not rigid, like a boarding house. Nobody wants to live in an overly structured place.

The Coliving Guy, Grant Shipman (20:08.6)

Like you walk in and there's rules, you know, posted on the oven, there's rules posted on the...

the TV, there's all these rules, and you're just a cog in the machine, right? And you're fine with that if you're only there, you know, a month to six months. But this X factor is, and we created our whole property management system around it. We call it household-led property management. We create a healthy household. We communicate that in our application process. The people who are often will self-select out of it, if that's not what they're looking for.

And we believe that as long as people are reasonable and responsible, they're gonna thrive in this household. We don't need those people to be a certain personality, a certain generation, something like that. So we create a healthy household. And like any healthy household, somebody might slip in that's in an unhealthy place. And that healthy household has a way to remove that person. There's a conflict resolution system, they can remove that person.

really simple. You know, just like any health house, right? Some uncle or aunt moves in and they get a little bit, you know, irresponsible for a while. They get talked to a couple times and then they get asked to move out. And you know, the best news we ever have is there's a when somebody gets, I mean, essentially they get kicked out, right? They get kicked out.

and they're all pissed off. But then a couple years later, they come back and they're paying money back, they're making amends, and they ask, hey, will you let me back in? And that house lets them back in. And they're one of the best members, and they said that was the most important thing that happened in my life, was me getting kicked out. So to say it's a healthy household, you don't need to screen personalities or interests.

The Coliving Guy, Grant Shipman (21:58.066)

and a healthy household not only protects against problems, but it makes everything wonderful.

Garret (22:05.224)

Okay. I think I'm starting to get it. Um,

The Coliving Guy, Grant Shipman (22:10.169)

That's good. I'm telling you, it's so nuanced.

Garret (22:11.668)

Okay, why don't we do this for the listener? Why don't, yeah, why don't we do this? Walk us through what I call, because we're both property managers, property management life cycle. So I'm a single person. I'm tired of fighting with my roommates, but I don't wanna live alone. Maybe I wanna share some costs. I hear about this thing called co-living. What do I do next?

The Coliving Guy, Grant Shipman (22:36.886)

do. Yeah. So what would happen is you would search on the internet. Most people do this. And you would find...

One of our listings we don't list any place in particular special, you know Facebook Craigslist You know software our software syndicates to you know, 21 different free sites, right? And so you would search and you would see a thing that says hey a room in a shared bathroom Some of our rooms have in-suite bathrooms or a shared bathroom say, okay, it's $700 where you know here it's in this area It's gonna be twice that you know for any kind of lease and you see

Oh, you don't have to have a minimum credit score, nor you don't have three times the income of your rent, which that's just because as a landlord, you don't have to have as many safeties in place. And we can talk about that later on the landlord side, but you would say, oh, okay. So then you would click on that link. It would take you to the website. The website has a little whiteboard explainer video, which is great. That shows you like, oh, this is how it works. And this is the kind of people.

and it's fixed rate utilities. So I don't have to yell at somebody if they keep leaving the windows open while the air is on, right, like you're like, oh, this could be really cool. And so you schedule a tour, you go to the house, one of the people in the house, we call them house members. They would meet you, walk you around the house, answer any questions. You would see a house that you'd be like, whoa, there's...

there's eight people that live here, it seems so quiet. And that's what we want them to see. So if you would come in and you'd be like, oh, this is so quiet. And does that kind of house appeal to you, right? Because that might not appeal to everybody. And then you would see a chore board. And the person giving you a tour would say, hey, each of us do 20 to maybe 60 minutes of chores each week. And that's what keeps this place as clean as you see it. You're like, oh, wow.

The Coliving Guy, Grant Shipman (24:39.184)

Responsible adults it is really easy to keep a place in the lawn Fantastic, right or shoveling the driveway in the winter if that's the area of the house so you'd see that and then the person would let the person would giving the tour would say thank you Garrett and And you know just be in touch with the property manager if you want to apply do you need that application link again? Nope, you already got it great

And so they would fill out an application. It's $27 in our area. It's normally $50 for an application So $27 seems really great. You fill that out Property management does a criminal background eviction background check on you confirms your identity social security all of that stuff and The person who gave you the tour Gives the property manager a thumbs up or a thumbs down right this hey this person they they're great

And if that happens, then you get a lease offer. You sign that lease offer online, everything is paperless. And then you set up your payments online.

Free ACH payments credit card payments optional you pay a security deposit $700 and then you're scheduled your move in and you move in you get a 20 minute member orientation your name's been added to the chore board Answering any of your questions. You have some storage shelves in the garage so you don't have to keep everything in your room, right? there's a Grill on the deck and then and then really you're just living your life Doing your thing you can reach out to the property manager in

our form of property management, our household led property management, which we think is extremely important. It is a necessity for co-living to work.

The Coliving Guy, Grant Shipman (26:27.106)

the property manager is known as the household supporter, meaning the household runs itself, but your household supporter is available for support. So you might have a question about rent or maybe you want to rent a parking spot in the garage. And so you might ask the household supporter, they get right back to you, but really you just live and enjoy your life. You get to know people, some houses, we don't do any kind of community events. We create a healthy household.

to have a movie night or a house might.

go to the downtown to walk Main Street or go out to eat. But those things in a healthy household happen organically. And then say you wanna, your lease is a month to month renewing lease, cause you're not sure about this house, right? That's kind of nice, it's month to month renewing. However, if you move out within 90 days, you know you lose half of your security deposits.

charge move in, move out fees, but it's intended to be, you know, at least a three month thing, but you're just like, this is fantastic, and you decide you want to sign a three-year lease because this is wonderful, or a one-year lease, or you just want to keep it month to month. However this goes on, you enjoy it, and then, I mean, yeah, it's, I would say

If you're one of about 50% of the members, you are there until you can't be there anymore. For instance, say your job takes you out of the area, or say you decide you wanna get married or something like that, and your future spouse doesn't wanna live in a co-living house, right? So, but we really do, people that it fits.

The Coliving Guy, Grant Shipman (28:17.302)

they love it and they can't find it anywhere else. And then there's gonna be other people that, they decide they wanna move on. We've had plenty of people return, after maybe a relationship didn't work out or a job transferred them back. Does that answer your question as far as life cycle? Great.

Garret (28:34.056)

No, it does for sure. A couple of follow up questions. So you mentioned chores. We are dealing with human beings here. So if Johnny comes in and loves everything and gets the thumbs up, and he doesn't take out the garbage two weeks in a row, is it the household supporter? Like, are we talking about he gets grounded? What happens here?

The Coliving Guy, Grant Shipman (28:40.684)

Yeah.

The Coliving Guy, Grant Shipman (28:55.566)

Hmm. Yeah, yeah, let's, yeah, and this is so important where it's the household led property management. This is really big. We teach it to anybody because it's so key. If the household, a good, a household that you wanna stay in is a household.

that you can help protect and stay the way you want to. So for instance, if Johnny is not doing his chore, then somebody reaches out to the property manager and says, Johnny's not doing his chore, right? Cause we love to complain to people. That's just how we are as humans. It's fine. The property manager just says, oh, that's great. Like actually, you know, remember the household covenant, which is part of your lease says, you know, to follow the five on five process.

what that is a whole other thing because it's so cool, but it's this very simple thing where somebody would say to Johnny, hey can we do a five on five? It's a 10 minute or less conversation and they share their thought. Johnny shares their thought back.

and if that solves it, great. And then hopefully everything is great because what builds trust is conflict. And I'm gonna say something in regard to other co-living options out there. There are co-living options that are very afraid of conflict.

out there. So for instance, they're going to encourage you to turn your living room, if you want them to be your co-living manager, turn your living room into a bedroom. Why is that? Well, they might say it makes you more money, but they will also add, if we have a living room, it'll increase tenant interaction, which will increase tenant conflict.

The Coliving Guy, Grant Shipman (30:52.142)

And what we understand is that tenant conflict is extremely important, because if you don't have conflict, you don't have a relationship. But if you have conflict in a way to solve that conflict, you just built trust. So I'll give a quick story in one of our first houses. There was one gal, she was home, she was so happy she was home, she had the day off, she loved it, she loved it, she loved it, and she heard a dog bark in one of the other rooms. She's like, oh.

But then that made the dog bark in one of the rooms in the basement. And they just barked back and forth and it was driving her crazy. And she had a dog and it wouldn't bark. And she was so pissed. And so she contacted the property manager. She's like, hey, can you tell these people, have their dog stock bark? And then the property manager says, hey, just follow the five by process. So, um, and she told me this story later. Her name's Kim. So Kim says, um, she this is this is back in 2017 when I was the property manager.

me later.

that she just, she would like, her heart like hated these women, you know, these other two gals in the house that are only dogs. Then she sent them a text and one was Amy and Amy replied right back, oh, I'm so sorry. She came back and, and with a little barking collar for a dog and it solved it right away and Kim just felt super loved like, oh wow, she was worried about me and she saw that and the, the other Gil, the other girl Jill came back and brought her dog to work with

figure out how to make that better. And so conflict built these gals' relationships so good. If it never happened, that would be a problem. So just to say what you're hitting on as far as, you know, all of us are going to slack on our chores sometimes and we need somebody to say, hey, you know, that might be a wife, that might be a roommate. But conflict is a way for us to

The Coliving Guy, Grant Shipman (32:50.06)

long as there's a way to handle that conflict. And if there's a way to handle and somebody doesn't respond well, then it's a way to take that further and set boundaries.

Garret (33:01.704)

Okay, no, that makes sense. Getting back to the leases grant, is it one lease or separate leases?

The Coliving Guy, Grant Shipman (33:08.609)

separate leases.

Garret (33:10.5)

Okay, so do you, maybe this is jurisdictional and city by city, because it looks like a rooming house. I was gonna say smells like a rooming house, but I mean, that doesn't apply if you've got your five by five rule, but that's really bad, I'm sorry, dad joke, but. Yeah, no, but in all seriousness, I mean, at least here in Manitoba, we would run into rooming house violations and licensing and bylaws and things like that. And actually in Winnipeg, Manitoba,

The Coliving Guy, Grant Shipman (33:18.347)

Right.

The Coliving Guy, Grant Shipman (33:24.741)

If it does, it looks like one smells like one talks like one. Hahaha.

Garret (33:40.)

You're grandfathered for rooming houses, but you aren't technically allowed to create another one. Do you see any conflict there depending on where you might have this co-living house to be classified as a rooming house?

The Coliving Guy, Grant Shipman (33:49.542)

Oh, a thousand percent. So, yeah, so when we, in 2019, we released a complete co-living course and something it starts off with, which is every real estate investor's thing, as far as what they do is they need to develop their criteria. And we talk about property TAF, which is type, your area, and how to find it and how to finance it, TAFF. And so,

area is a key part of that is knowing what the local regulations are.

So this lots of times has to do with zoning. So is it light residential, medium residential, commercial, heavy residential. Some have like say the state of New York or the state of Iowa. They have a law that says hey the fair housing agreement completely outlaws like the idea of

The Coliving Guy, Grant Shipman (34:55.696)

status, right? Where other states and I'm sorry, I'm not familiar with any Canadian example but other states have very strict laws. The ones that developed in zoning laws for cities in the 70s was no more than three unrelated adults or a town near us says U plus two. So these are really key and actually a town that I was in, they changed these rules

Garret (35:16.317)

Oh wow, okay.

The Coliving Guy, Grant Shipman (35:26.316)

which is really annoying. But to say when you're picking this out, it's key to contact whatever local or regional state or government official and say, hey, of course, can this, can I have, do I need a rental license? What laws are there for occupancy? Actually, the state of Colorado is looking at statewide not

The Coliving Guy, Grant Shipman (35:55.676)

status. So these laws are changing in the states. I'm not sure about other countries.

Garret (36:01.76)

I know that we have a lot of university students up here and we will tell them, that's fine, we can have university students, but you're all going to be on one lease. We're gonna make, you can designate a spokesperson, whatever it is. So it kind of forces everybody to obey the rules of the household and make sure that again, we'll pick on Johnny, but if Johnny hasn't paid his rent, well, all the other four roommates are in danger of being evicted.

The Coliving Guy, Grant Shipman (36:12.791)

Mm.

The Coliving Guy, Grant Shipman (36:24.397)

Hehehe

Garret (36:29.304)

Do you ever put everybody on the same lease or in your model, it's always different leases?

The Coliving Guy, Grant Shipman (36:34.286)

It's always different laces. And I think that's a, I mean, it's important.

you know, a healthy household, people are responsible for themselves. Although there's obviously, it's a level of interdependence, but particularly when you're separate adults, signing the same lease is a problem. And I think it's actually a, it's a little bit of, sometimes us real estate investors, buy and hold property managers, we sometimes can make mistakes. Like so for instance, saying that dogs have to be under a certain weight if you wanna have your dog there. Now this can be great,

other side says, hey listen, you know, the big fat heavy dogs are the ones that don't cause problems. It's the little ones that dig holes in doors and carpet. But in relation to this, and this is where I like the states that have landed on not discriminating against people based on their family status, is one of the Supreme Court judges of Iowa argued very thoroughly that according to

The Coliving Guy, Grant Shipman (37:38.676)

or monks or nuns couldn't live together, but 20 cousins with their motorcycles can live together in a single-family house.

and because they're related by blood. And so the idea is not so much, is this family related or not, or are they on the same lease or not? The idea is that there needs to be health, safety, and whether it's sound, noise, these people need to act reasonably if they have neighbors that are close and they live and wanna enjoy a city. And so those laws are there,

starting to realize, hey, the safety that we thought we had by these other rules, that's not getting us those things, and we need to beef up our rules on, you know, just people acting reasonably, you know.

Garret (38:40.109)

Okay, okay. Are these houses, I mean, I think it's obvious to me, but are they all being rented as furnished?

The Coliving Guy, Grant Shipman (38:51.135)

We started, so all the common areas are, so the common areas are inside, outside, except for private bedrooms.

Garret (38:54.944)

Okay.

The Coliving Guy, Grant Shipman (38:58.97)

We started out furnishing private bedrooms and some people decide to do that. We have found that most people want to furnish their own private bedroom. If somebody wants to move in and they want to pay an outside service, we connect them to that, you know, can furnish their bedroom before they show up. That's almost never used. I think, Garrett, if I could...

touch on a couple things as far as like zooming out with co-living like an industry and the options there if that'd be great yeah and then as far as from investors because

Garret (39:33.796)

Sure, no, absolutely. Yeah.

The Coliving Guy, Grant Shipman (39:39.374)

Renters, this is the thing right now, the number one demand, this is also in Canada, the number one demand in Canada and the US and similar countries is the single person lease. It's a number one rental demand. I actually got in, it was really funny because I was this like young punk investor, but I would get in arguments on say bigger pockets or otherwise. I mean,

helpful debates, that's really what it was, but with very experience. And they were going off, say, the Census Bureau, right? Where defined household based off of, not who's living under the same household, but a financial household. And so, however, if you look at any of actual research, Harvard, banks do it, who is living together, the number one demand for a rental unit is the single person lease, which co-living speaks to

Garret (40:10.372)

Sure.

The Coliving Guy, Grant Shipman (40:38.356)

Um, and, uh, um.

But in regard to co-living, renters already want this. As long as they show up and the house is nice and the price is great, which it is, and the property manager seems, that's great. What we need is investors to recognize this co-living option that lots of times they either never knew about, or they just think it's rent by the room, or it's college housing, or it's senior housing, or it's sober living.

The Coliving Guy, Grant Shipman (41:11.56)

is I had so many people that might be familiar with.

with Oren Clough. He wrote the book Pitch. It's like it's considered some required reading for marketers But he I was on a hot seat Let's see two February's ago in Vail at a conference and he looked over our website Living Smith website He looked at everything and he goes Grant. Here's the problem He goes you're explaining this like you created this because you don't know how to explain it Otherwise because people have never heard of it that you talk to he goes, but just two months ago

For a few hundred thousand dollars, I created a pitch deck for a large company. It's a several million dollar company. He goes, in the US alone, this is a hundred, co-living, it's a hundreds of million dollar industry, if not low billions. He goes, the world is billions and billions. This is a massive industry. Since 2003, more people have been living alone than any other group of people.

massive but the issue is these are the large hedge funds, big money, institutional investors and companies have owned this space. He said what you and others are starting to do is showing the individual investor how they can get into the space which brings it out of the big cities like LA, New York.

and throughout the middle America, which is really great. So just to say, I wanna cover from investors because that's my deals. I wanna encourage investors to learn about co-living. There's lots of options out there. To find co-living that really works, I would encourage a co-living company that is not afraid of conflict. So one large co-living company, they have a 24-7 hotline where tenants can call to solve their conflicts. This means

The Coliving Guy, Grant Shipman (43:08.284)

they don't know how to have the house solve their own conflict. Can you imagine two renters that you've never met in your life calling you up at 2 a.m. and you're trying to solve their problem? Just to say though, what happens is a typical house, so a house that would rent out in my area for $2,700, in co-living I can get $5,600 for it.

So, so this is significant. It is the same house. It is only one roof. It is only one kitchen sink. I'm maintaining However, my rental strategy Just way up the revenue if you're in multifamily and you change to a co-living property management Rental strategy you have just upped your cap rate

Garret (43:35.145)

Okay.

The Coliving Guy, Grant Shipman (43:54.934)

which is significant without spending any additional money. Some other, and these are the reasons why I went from, I mean, I was delivering Domino's Pizza in 2017. And in 2019, it was a little less than 24 months later, I had a $3 million portfolio and had financial freedom.

And since then I've only needed to work three hours a week. I like to work 25 hours a week because it's fun doing this kind of stuff I really enjoy it and spreading the message however as investors realizing that Just like with anything if you're Airbnb business If you're an investor and or property manager if it's taking you too much time It's because you don't have the right management systems in place

They're out there you can find them and that's the same with long-term rentals It's the same with short-term rentals, but co-living is so new people are trying to manage it like they manage other types of Rental strategies and it's its own unique rental strategy. So that is really key So for example for our system a lot of people I want to start encouraging people to share specifics

our system we can have one full-time property manager, so a $40,000 to $60,000 position, so 40 hours a week, and then a 20 hour a week admin, we use foreign VA, so they're around, let me see, $450 an hour, right? So fairly cheap, about 80 a week. They can support at least 140 leases.

So really understanding what the property management load is with the proper systems, we're always learning and growing. So is our system good? Do we have 100% confidence in it? Yes. Are we always wanting to learn? I just took, there's a co-living week-long course out by another company, and I just took it because I want to, I mean, right now, those in the co-living space are not competitors.

The Coliving Guy, Grant Shipman (46:12.02)

to try to help people understand even what co-living is. So just to say, it's a massive space. However, I mentioned that one company, Ali, with its $15 million, it didn't survive the pandemic. Star City bought it. It didn't survive the pandemic. It was bought by Common. Common is $113 million startup in 2015. Less than 50% of their properties are now co-living properties.

They have a lot of issues, but these aren't bad things. It's just they're finding their property management style. We would have those same issues if we didn't learn from, and I guess this is something I didn't mention, is I didn't make up this stuff myself. What I did was I lived in a number of co-living places. One was started in 1978 by the people who went on a few years later

Whole Foods in Austin. And they were in the intentional kind of that what we would say like hippie-ish like in a good way stream of things but they had decades of this built-up tradition of how to live together in really beneficial ways and they did it so well that I just took a lot of their stuff I stood on their shoulders and took a lot of their systems and just transitioned

Garret (47:12.664)

Hmm.

The Coliving Guy, Grant Shipman (47:40.032)

rental strategy that had nice houses or really like what do you call like middle-class nice houses and so

So to say that the industry out there is huge, tons of money is being pumped into it. A lot of people are losing, but there are winners coming up just like any young industry. And then to share with you the last thing, as far as this, the big thing, my best warrior call for investors out there, whether large or small, if you are multifamily, if you have 100, 300, 500 plus units, this is worth you checking into.

not all your properties are good co-living properties. A huge thing is that the property has to fit the usage, right? But if it does fit the usage, right? The...

The parking, the square footage, the bathroom to bedroom ratio, all of these things. If it fits that, not to mention the zoning and local regulations, if it fits that, the finances are phenomenal. And I'll give you an example. I don't get a house unless my cash on cash return is higher than 50%. That's just period. That's how it happens. And that's...

I mean, unless you're awesome with fix and flips or other magic things, I haven't met people who are able to pull that off. And that's the reason why I was able to get financial independence so quick with none of my personal capital.

The Coliving Guy, Grant Shipman (49:12.01)

And in the kind of the last thing to wrap it wrap it up with encouraging investors out there Is to say to really get? to really get Training or some kind of a an understanding of property management that fits

Co-living because investing you're just going to use all the different you know you know tried and true investment strategies of buying whatever property you're interested in but with co-living we recommend single family housing it has all the purchase and asset benefits of single-family housing all of the rental benefits of multifamily housing when I have a person move out because it's month-to-month lease I don't care because I'm still getting six checks

Right? I also, the property stays super nice because there's seven responsible adults in there. If somebody's a problem, those other six are going to take care of it. Also, every month my property manager walks that property and they love it when they see her. She comes in, she refills their cleaning supplies and leaves some candies and they're like, yeah, she has though, she's seen that property every time. So these properties stay in great shape. So I want to encourage you that this is possible.

It's very much a system. None of my renters know many more. This is, we have staff doing it. They follow the systems. We use normal property management software. It is awesome. But don't jump into it like it's typical long-term Airbnb rentals. My best guess for you is like these multi-million dollar startup companies.

just in a smaller scale, you're just gonna be pissed and frustrated in about a year to two years and you're gonna switch back to something and say co-living didn't work.

Garret (51:02.048)

Wow, okay. I hope everybody was taking notes there. So let's summarize it. No, that was great. And you have no PowerPoint slides whatsoever. Okay, so let's take a top-down view as you said. Single housing is growing and it's gonna become the greatest need. Cash flow wise, I mean, your $2,700 rent in a suitable house is only giving you a couple hundred bucks worth of cash flow.

The Coliving Guy, Grant Shipman (51:05.026)

So that was... That was just... I'm just so passionate. So cool, you know?

Garret (51:32.044)

you're adding a couple thousand dollars of that. So if somebody really wants to be financially independent or even take over their salary, they literally only need two or three co-living houses to make it happen. However, and there is the underscore, you have to know what you're doing. You can't use traditional property management techniques because you have to manage the household occupants the proper way to success and your best.

Obviously you want to put a plug-in for your own company because you teach this stuff, but at least just recognize that you can't just rent it out like a long-term Airbnb. I wanted to add a further point because my investor mind is kind of churning here. You're talking single-family home. Obviously everybody out there listening knows what a BRRR is. I mean, this is a perfect opportunity.

to whether you're going in with your own money and burying it and getting that out, or you're using a capital investor or JV partner and doing it that way, and then tons of cashflow with only one asset, one roof when heating. I mean, it seems too good to be true to tell you the truth.

The Coliving Guy, Grant Shipman (52:38.925)

Oh my gosh.

The Coliving Guy, Grant Shipman (52:43.102)

Right. Well, and, and you're, you, you nailed it. Um, and so I must have done such a good, sometimes I confuse people to daylights, right? Sometimes the people, my staff explain it better because I'm so excited. I get like lost, right? So I'm glad that it's so much a game through. You're just really good at. But to say is, is

Garret (53:01.892)

Yeah, I'll just put a quarter in the machine and it'll just let you go, right? Ha ha.

The Coliving Guy, Grant Shipman (53:06.35)

You nailed that and the benefits of lower insurance. The reason why I would say the two good to be true is because we get paid based off the value we provide.

And right now the number one demand value is the single person lease. And we've just taken a house that would normally only provide a little bit of value or, or whatever a normal house provides. And we've just multiplied that value and people get, so this is the cool thing is, is somebody, an investor gets way more for way less, right?

a renter, it's the same thing. They get a whole nice house for the price of a room. So the way I like to put it is that in co-living, if anybody is gonna win, everybody has to win big. Like it's just a cool thing.

Garret (54:04.916)

Well, this is the investing to win podcast. Okay, that was bad. That was bad. No, okay, all seriousness. I'm gonna give you a couple of minutes because I know nothing about this. Why don't you kind of go through what you guys teach in your course? Of course, I'm gonna be putting your contact details into the show notes, but give us an investor an overview of what they can expect.

The Coliving Guy, Grant Shipman (54:06.579)

Hahaha! Whoo! That was great!

The Coliving Guy, Grant Shipman (54:28.074)

Yeah, so what we've been trying to make our products to really fit where people are and what they want. So we have a toolkit, because people are sick of courses. This is what we've heard. They pay for courses. The courses did not get them what they thought it would get them. And so...

We have toolkit meaning templates, SOPs, things like leases, master leases, LLC documentation, syndication documents, marketing templates.

Email templates for property management, text templates, everything that we use, we've just made that made that available. And one toolkit is finding and financing a co-living property. So it's not just its financial criteria. You can really, I mean, we're not teaching anything different than others out there.

in regard to that. There's really good stuff, right? If we were teaching something different from than BiggerPockets or Gary Keller, then we'd be teaching the wrong thing because they're teaching great stuff, right? But the functional criteria, right? What about square footage and bedrooms and to bathrooms and parking and all of this stuff, functional criteria is really important. The second toolkit is all of the property management, the household led property management. We consider it the gold standard in co-living.

And that is its own separate toolkit. And that's, it's really phenomenal. And it's actually something that is, makes things much easier. So if somebody is managing it themselves, or like when we started out, this, a house would take like, a seven person house would take like 10 hours a week. Now it's taking one hour a week.

The Coliving Guy, Grant Shipman (56:28.426)

And that's because it's exactly what the house wants if you live in a house you want it to run itself You don't want to have to go have this back and forth with this person who's in charge the property manager that doesn't even live in the house So we have that but something if you get on our website, we just relaunched and you can get a Free 30-minute call with any of my staff. That's really neat. Oh, but Garrett I was thinking about like if I'm one of your listeners because back in 2016 2017

scouring anybody who would, you know, was doing this because I wanted to learn, right? I was new. And so something I've made, so if you go to our website, livingsmithpro.com forward slash secret gift, made this for your listeners. They can schedule with me.

for 45 minutes and it is any question they have, I will give them my absolute best on answering that because everybody's in a different place. If somebody is an extremely experienced investor, they need to, they need other questions answered. If somebody is extremely experienced, say they come from the intentional community, but they need to understand real estate in business, that's a different thing. We go from bookkeeping to what do you put your property in an LLC or not, to lending

creative financing sub two, I would say the final thing that we teach, which I'm not seeing taught out there, and this is more for like the newer hustler, is anybody's familiar with house hacking? Garrett, did you do, a lot of people, investors, you know, at some point in the beginning, they did some kind of house hack, did you do anything like that? Right, yeah.

Garret (58:14.824)

Of course, yeah, no, I've done it. I recommend it. I've got a 19 year old and a 21 year old at home. And I said, I'm going to kick your butts if you don't house hack when you move out. Do not just rent. No, no joke. So I'm an advocate of it. Absolutely.

The Coliving Guy, Grant Shipman (58:26.091)

No joke. Well, so this is when my course came out in 2019, I called it Beyond House Hacking and confused the daylights out of everybody. But but um.

But this is, now we call it, now we call this strategy House Hacking 2.0, because what is house hacking? You get a house with owner-occupant financing, right? So one, 3.5, maybe 5% down. It's amazing, at least that's right in the states. And then you, so you get owner-occupant preferred rates for, or terms for the loan. Then you rent out the rooms, probably, for the first.

12 months, 12 to 14 months, and then you can turn it into whatever kind of rental you want. Now, what's the cool thing about co-living is it makes that first year really way more enjoyable because that's the way the house is supposed to be. You're living in one room and the house is making great returns. Then when you move out, congratulations, the house just made more returns.

and you can continue to duplicate that. If you go even further with it, what we do is we bring teams together. One person might bring the money, another person might qualify for the loan, and another person who will be on the loan is going to commit to live in the house for 12 to 14 months.

And so now you can don't have to wait 12 14 months You can really power that up and the great one is because you know how to property manage Co-living that first year it goes smoothly I lived in these houses for my first two years and I loved it I mean it was it was fantastic. Nobody knew that I actually owned the house It worked out well, and so you don't have the pressures of anything. So so to say

The Coliving Guy, Grant Shipman (01:00:13.64)

For as far as what we teach, those are the main things. But really, wherever somebody's at, whatever questions they have, use that 45 minutes with me in the intake. Send the questions that you have. I'll try to do research. I mean, my hope is whatever we're doing that's good, is other people replicate it and they get those results. Also that I get to learn

I when I did this co-living training this week long one. I gained something really super cool I didn't know it before and so I added it to mine and I ended up Getting a free house and walking away with $30,000 on top of it. It was bomb

Garret (01:00:56.924)

Well, like I said, my mind's kind of churning away here. Okay, let's cap it at that. We're gonna be putting all that information. I do appreciate you with the offer from my listeners. I'm sure many people are gonna take advantage of it. And I prepped you with this question. So I hope you did some soul searching. This is the Investing to Win podcast. How do you define winning and what does success look like for you?

The Coliving Guy, Grant Shipman (01:01:26.622)

Yeah, thank you so much. The define winning to me is that a person knows what winning is, what they really want. That for me, I let go of what I thought I want or what my parents wanted for me or what the personal growth coaches want, define success that I really found what I wanted and how I wanted to get that.

And so that's how I would define success is, I mean, what your question actually points to is define it for yourself. Otherwise, the only way to be fulfilled is to know what fulfills you. And so success or winning for me, what it looked like was I wanted a family and I wanted meaningful work, work that meant a difference for me.

and that gave me the finances and the schedule to really enjoy my family and friends. And I just, I'm about to turn 43 and so far the 40 decades is, I mean each decade's been my favorite, but it keeps getting better, right? So it's, Garrett, what you're doing here...

and how you do it, like it's really efforts like yours that have helped me to figure out my own success and to experience it more and more. So thank you for doing that.

Garret (01:03:03.956)

Oh, you're very welcome. I actually messed it up. It was supposed to be, this is the Investing to Win podcast. How do you define success and what does winning look like for you? And I think I had it backwards, but that's okay. I might edit that back in. No, seriously, thank you so much for sharing the insight, for giving me a window into something I never even knew existed. That's why this podcast is here.

and your wealth of knowledge. And I will be reaching out offline to find out more about this opportunity.

The Coliving Guy, Grant Shipman (01:03:33.806)

Great. Something we are doing our best because the courses can be higher priced and different things, you know, people are wrestling with credit and stuff out there is we are coming out with a book.

which we already have one out called Welcome Home, but that's more renter focused. But we are coming out with a book, Co-living Investment, the gold standard in co-living and property management. But that book is gonna be a normal price book and it really is, we're not holding back. I mean, we unfortunately, it's not like our 22 page lease is in there and pages and pages of SOPs and things, but.

I mean, everything is in there, we're not holding back. So if you are a book person, keep a lookout for that. And again, whatever that me or my staff can do to help, it's one of those situations where like co-living is kind of too good to be true. So it's easy for us to help others because we're just as excited about it, if not more than them.

So thank you again so much, Garrett.

Garret (01:04:46.14)

Okay, no, that's great. It's great that you're having a book. What a great resource. Okay. Well, thanks for coming on and we will definitely be in touch.

The Coliving Guy, Grant Shipman (01:04:54.823)

Thanks, Garrett. That's great.