Our last newsletter of the year! It’s so surreal to finally be at the end of 2020 after everything that has taken place this year. This has been a massive growth year for my relationships, friendships, business, education, spiritual, & personal life! I’m so glad this year is coming to an end, but looking extremely positively into the next year with goals set, mind open, and a persistence for continued growth in all areas of my life. We’ll already be starting 2021 off with a new deal to close! :) (More to come soon) But now into the bread and butter that are our monthly newsletters.
How to Know When to Hire Michael Gerber, author of The E-Myth, has a great little play-by-play rundown of what goes through most entrepreneur’s minds when they hire their first employee. One of my favorite books of all time. (I should really re-read it again…) It goes something like this: “There’s a critical moment in every business when the owner hires his very first employee to do the work he doesn’t know how to do himself, or doesn’t want to do. In your business, Harry is that person. And this Monday morning is that critical time.
“Think about it. You’ve taken a big step. The books are on Harry’s desk now rather than yours. And what’s more, Harry is about to become the only other person in the whole world who knows the real story about you and your business. Harry is going to take one look at the books and know the truth. Harry, your very first and most important employee, is about to find out a secret you’ve been hiding from everyone else in your life: That you have no idea what you’re doing!
The question is, what’s he going to do about it? Will he laugh? Will he cry? Will he leave? Or will get to to work? And if Harry won’t do the books, who will? But suddenly you hear the quiet, systematic clattering of the calculator’s keys from Harry’s desk. He’s working!” I know that’s a funny little story, but all too often it’s reality. How often have you procrastinated doing something that you know had to be done by a certain deadline? I know I’ve done it too many to count.
I was listening to a podcast the other day and the guy said flat out “Procrastination is a good thing.” I was thinking “This guy is nuts. What the heck does he mean it’s a good thing?! It always gets me in trouble!” After hearing him explain why he thinks it’s a good thing, I have a new found love for procrastination.
Without procrastination, we wouldn’t know what we really don’t like to do or just aren’t good at doing. Procrastination gives you the direction on what you need to outsource to someone else in order to work on higher dollar per hour tasks that only you can work on as the head of your company. When you procrastinate doing something, it’s your mind telling you that you don’t like doing it or that you have no idea how to do it. Once you begin outsourcing these tasks, you can truly use your special ability, that brings you joy, to grow your business! My mind was blown. I’ve since made it my goal for 2021 to outsource/automate anything that takes time away from me doing what I love and what I’m most good at!
This newsletter won’t be about how to hire (for that, see here), but instead will focus on figuring out when to take the hiring plunge and what alternatives you may want to consider.
When NOT to Hire Your First Employee Unless you’re coming at real estate investing with a large sum of money and/or a partner, you will want to start off doing most of the work yourself. This not only reduces your costs up front, but also allows you to learn the various parts of the business. One essential thing to have when managing employees is a decent knowledge of what those employees’ jobs actually entail.
But there are other reasons that it is not necessarily wise to hire an employee, depending on the circumstances. Here are two important ones:
You’re desperate. Often, a hiring decision is made in the heat of a stressful moment. You have more work than you can humanly handle, and you just need to get another body behind a desk. A hasty decision born of desperation is rarely a good one.
"You don’t know exactly what you want the new hire to do. Another mistake involves realizing you need help, but not knowing exactly what that help is going too look like. Unless you have a defined set of responsibilities and expectations for your new hire, do him or her a favor and don’t hire anyone. A new hire at this stage will rightfully be confused and ineffective. So, instead, hire a coach, not an employee.
Doing almost anything out of desperation is a bad idea and bound to lead to a mistake. And it’s also important not to hire someone without having a good idea of what you actually want them to do. Overly broad job descriptions usually lead to an employee procrastinating or being confused.
When it is Time to Consider Hiring Someone
The key questions to ask yourself when looking to hire someone are the following:
Is there something more productive I can do with my time than the job I would be hiring out?
Does it make financial sense for me to bring someone on at this time?
Does this job fall under a particular skill set?
Is there another alternative to hiring someone?
The answer to question 1 is almost always yes. You are rarely going to be the best person to do everything. Almost no one is great at marketing for sellers, analyzing deals, negotiating deals, managing properties, doing the rehabs and the accounting all at the same time. That being said, if you’re on a tight budget or in the early going, it’s probably not worth the expense of hiring someone—at least not yet.
And as noted above, you will want that position to fall primarily under one skill set. For example, if you have enough accounting work to hire a bookkeeper, go for it. But it’s not a good idea to have a bookkeeper spend half their time on accounting and half on maintenance, or something of the sort.
Oftentimes, you’ll realize that you need some help, but not a full time employee. At that point, you should consider alternatives.
Alternatives to Hiring a Full-Time Employee The most obvious alternative is to hire a part-time employee. There are a good number of people, especially stay-at-home parents, who are looking for part-time work. Jobs like being a part-time bookkeeper or leasing agent make a lot of sense for them. And sometimes, these people can grow into full-time employees as the amount of work you need done, expands.
Another alternative is using 1099 contractors instead of W2 employees. Obviously, this works in the construction field, but there are also third-party contractors you can use for maintenance, leasing, accounting, and other such activities. For example, there are leasing companies that will show your properties for you on a commission basis and maintenance companies that do maintenance for local landlords, but without you having to hire a maintenance staff. This is especially helpful for landlords with just a few properties who are managing themselves. If you only have a handful of properties, you won’t have the volume of work to justify hiring a maintenance technician full-time. While you can use contractors for maintenance, their availability may be spotty. So these types of firms can be very helpful.
And, of course, you can contract out property management altogether. Finally, for many jobs, virtual assistants are something you should look into. With technology these days, people across the world can work for you, and many of them will only charge a few dollars an hour. Popular platforms like Upwork allow you to set the wage and hours a freelancer can work for you. Then you can assign them all sorts of projects, from finding lists, to data entry, to transcribing notes, to whatever. It’s definitely worth considering whether the job you require can be done with a full-time or part-time virtual assistant before looking to hire.
Summary As you expand, you will eventually need to hire an employee/outsource remedial tasks. This is a scary step but a critical one to ensure further growth. It is essential to know the right questions to ask yourself as well as potential alternatives for figuring out when that time arrives.
Mobile, AL Market Analysis
Business:
The U.S. Department of Agriculture has announced the Women, Infants and Children (WIC) special supplemental nutrition program managed through Mobile County Health Department (MCHD) has been awarded a general infrastructure grant of $228,572. The funds will be used to renovate the WIC facility located adjacent to the Citronelle Health Center. This project is an opportunity to provide the participants of Citronelle a separate clinic location in which to conduct WIC business in a healthy environment with improved privacy. The Citronelle WIC staff currently conducts its program in the same building as the Citronelle Health Clinic. The waiting area is not large enough to accommodate both clinic patients and WIC participants. The Citronelle WIC Clinic would like to offer its participants an independent building space to receive the WIC program’s nutrition education and food benefits.
Somerby of Mobile recently announced the windup of its $1.5 million renovation project previously reported at its onset in Lagniappe. The Mobile-based senior living community, which initially opened for residents in 2005, wrapped up a remodel that included repainting the entire property, updating and replacing flooring, furniture and lighting in the common areas surrounding the community’s 221 private suites, and major upgrades to the dining room and on-site theater. The community is located at 901 Somerby Drive in West Mobile and offers apartment homes accommodating senior tenants looking for independent living, assisted living and memory care options. The residences feature modern amenities and living spaces that range from studio apartments to two-bedroom apartments with dens. “Our longtime residents and everyone on our team are enjoying the comforts of home with fresh touches around every corner,” Somerby of Mobile Executive Director Jessica Keith said. “We are ready to welcome new residents.” Somerby of Mobile is operated by Bridge Senior Living, an Orlando-based property management company handling more than 25 senior communities in 16 states. The company oversees communities offering a full continuum of care, including independent living, assisted living and memory care.
The former 2,100-square-foot Hardee’s located at 6321 Cottage Hill Road in West Mobile. Expectations for the site, after extensive renovations, involve opening sometime in late spring of 2021 as the first Mobile location for Baldwin County-based Aloha Hospitality Management’s Wingfingers concept.
Last month, the Eastern Shore Chamber of Commerce held a grand opening and ribbon-cutting for BizPad, reportedly Daphne’s first co-working space, located at 26241 Equity Drive, Suite 101. The 1,262-square-foot co-working space comes completely furnished with a tall ceiling and natural light. The space has a private kitchen with full access to a coffee bar. Amenities include 24/7 building access, a high-speed Wi-Fi network, a conference room with video conferencing, mail and package handling, print and scanning services and a snack room area.
Atlanta-based regional brokerage company Atlantic Retail is involved with a local retail and restaurant development, located at the intersection of Highway 98 and Old Battles Road (County Road 34) in Fairhope, that will soon be home to a new Publix anchor space. The center has eight outparcels currently available, ranging from 1,050 square feet to 4,200 square feet in leasing space and sitting on sections of land ranging from 0.8 to 1.87 acres.
Some 8,800 square feet of office and warehouse space was recently leased by Fort Worth, Texas-based M&M Merchandisers, a consumer electronics and musical instruments wholesaler and retailer. The company supplies stringed instruments, percussion instruments, microphones, sporting goods, hardware, tools and other products throughout the country.
Robert Cook and Kenny Nichols reported Vallas Realty handled the closing on a 1.15-acre plot of property fronting of the Publix shopping center in Foley for the construction of a new Cook Out fast-casual restaurant for $952,000.
Viewed with six months of hindsight, it seems that the wildly successful opening of the quirky, membership-based BrewHounds Brew Pub and Dog Park was a minor miracle occurring during the onset of the COVID-19 pandemic earlier this year. The boa constrictor-like death squeeze felt by many business owners struggling to survive quarantines and lockdowns, while living day by day, has left much of the area reeling while rolling full bore into the holiday season. Home most recently to the Haint Blue Brewing Company, the site is more well-known for a much longer stay, after opening nearly 120 years ago, to the generationally owned Quinlivan family’s historic Crystal Ice House Company, tucked away inside the Church Street East neighborhood in downtown Mobile. This Saturday will reportedly mark the next step in the rapid evolution of the popular space created by company founder and president Jim Ivy: a name change to HopHounds for the pooch park and pub, and the addition of a brand new related business, a 136-square-foot stationary food truck called Sticks & Stacks to be parked next door serving gourmet hamburgers and hotdogs. “There were several businesses nationally using the name BrewHounds in one form or another,” Ivy said. “We wanted a name that was truly ours, to own and secure the trademark. The success of our brewpub and dog park has been tremendous and it was clear that if we were going to expand, the right name would be critical to growth. HopHounds fit our needs.” Both businesses are located at 806 Monroe Street. HopHounds still offers over 8,000 square feet of off-leash play area, including an area for small dogs. The 1,000-square-foot deck with tables remains from the initial opening in late May, but the 2,500-square-foot indoor space will now be filled with more tables and chairs to accommodate patrons of Sticks & Stacks next door. The bar will still retain its stock of choice, wine and craft beers, but the soda and bottled water sections will be expanded. To use the space, any canine over 1 year old must be spayed or neutered, and proof of vaccination must be presented. Access still starts with single-day passes that are now $10 per dog Monday through Sunday as well as holidays. Annual memberships are $225 for a single hound, $275 for a duo and $325 for a three-puppy pack.
The Gulf Shores & Orange Beach Tourism media department recently announced the opening of three new restaurants in the area. Brookman’s Smokehouse, located at 1544 Gulf Shores Parkway, Suite C, will offer smoked fish and meats in a made-to-order format; OSO Early, a breakfast spot, will be located at 5749 Bay La Launch Avenue in Orange Beach; and A Sweet Secret Bakery and Café, located at 1538 Gulf Shores Parkway, will serve breakfast, lunch and specialty desserts.
Real Estate:
This past Monday, the University of South Alabama’s Center for Real Estate and Economic Development (CREED) released its November report, which focused on local mortgage lending trends for 2020. “In July, we examined the booming residential Baldwin and Mobile County residential real estate markets. In September, we discovered that commercial real estate markets were holding their own despite downturns in the overall national economy,” CREED Director Reid Cummings, DBA, said. “This month, we turn toward mortgage lending, another critical aspect of our regional economy.” Jana Stupavsky, the center’s assistant director, created a report covering Mobile and Baldwin County mortgage lending metrics, which highlighted sales of new and existing single-family residential homes, condominiums and commercial properties. Data summaries indicated that total loan volumes for existing single-family residential mortgages hit a five-year high earlier this summer, topping out at $97.5 million in Baldwin County and $87.6 million in Mobile County; monthly loan transaction totals also reached a nearly two-year high in both counties. Reflecting Baldwin County’s positive new home development activity, new home loans climbed to $48.9 million, a 46.1 percent increase over the previous high set in June 2018. Likewise, Baldwin new home loan transactions reached a five-year high of 232 in June. Though loan volumes and transactions in both counties have fallen slightly since summertime peaks, activity remains brisk relative to the overall previous five-year period. Condominium loan volumes and transactions tell a similar story according to the report. Baldwin County monthly condominium loan totals reached a five-year high of $45.6 million in August. The 290 transactions closed in June 2020 was just barely under the five-year high set in June 2017. Commercial mortgage transactions fell initially during the early months of the pandemic, but since then, have trended higher. In Baldwin County, February’s monthly total of $24.5 million remains its high point for the year. Baldwin’s monthly totals reached their low point in May at $3.9 million, bounced slightly during the summer months, and finished September at $4.0 million. A somewhat different pattern occurred in Mobile County over the same time frame with a peak monthly total of $44.9 million in February falling to a low of $3 million in May. However, September monthly loan volumes reached their highest point in four years, finishing at $18.8 million. The report went on to interview key bankers in the region to get feedback on the challenges facing the local real estate industry moving into 2021 with the current pandemic economy. Overall consensus indicated continued positive growth. “It seems that notwithstanding some areas of caution, area bankers’ commentaries suggest we are on track for continued economic recovery and robust lending activity in the year ahead,” Cummings said. “Though as we have learned in 2020, surprises can quickly change things. Our sincerest hope is that any which come our way will change things for the better all around.”
U-Haul has purchased St. Francis Plaza, a 73,771-square-foot neighborhood retail center located at 2501 Government Street in Mobile, for $2.4 million. Retail tenants in the center include Salvage World, Dollar General and Advance America. U-Haul plans to gradually expand its current footprint on-site by utilizing vacant spaces in the center as leases expire.
Education:
According to a press release, a new learning program developed by local nonprofit Flight Works Alabama will soon provide a set of classroom kits and interactive techniques designed to help instructors expand students’ creative capacity and encourage the development of innovations and inventions. The program, delivered through seven We Build It Better innovation kits, will introduce new and inventive technologies that will offer unique resources and promote career awareness. Flight Works Alabama is partnering with Airbus, the state of Alabama, Alabama Power Foundation, Amazon Web Services (AWS), Snap-on Incorporated, Mott MacDonald, the University of West Alabama and the University of South Alabama to develop and deliver the We Build It Better program. “This exemplifies Flight Works Alabama’s commitment to innovation within science, technology, engineering, arts and mathematics (STEAM) education,” Chairman and CEO of Airbus Americas Jeff Knittel said. “Through this program, middle school students will be introduced to a stimulating curriculum, providing them with workforce skills they otherwise might not receive.” The in-school pilot program will begin in January 2021. Middle school teachers will be provided with the first three of the seven innovation kits. The kits will provide an array of instructional videos, hands-on activities, tools and materials, as well as assessments. The entire seven-module program will be piloted at Flight Works Alabama during Spring 2021. “We Build It Better offers crucial integration of hands-on training, practical skill acquisition and workforce development to Alabama’s middle schoolers in a unique way,” Alabama Governor Kay Ivey said. “The program directly aligns with Flight Works Alabama’s mission to equip Alabama’s future workforce through innovative educational offerings, which the state supports.”