Chapter #6: The Portfolio Takedown Play

Play number 6. The Portfolio Take-Down Play. It's the little details that are vital. Little things make big things happen. John Wooden, famous UCLA coach. As we begin this chapter, I'm reminded of Dan Brown's The Da Vinci Code. If you're a millennial or older, you probably remember the book or the Star-Stated Movie. The Da Vinci Code comes to mind for this chapter because of its core concept. That concept is one of the things that has made the book so compelling for readers around the world. What's the concept? Simply put, it's that incredible things can be hidden in plain sight. In the story, this occurs with the Mona Lisa, the world-famous painting that has been seen up close by millions over the years. In the story, despite being on display in plain sight, the Mona Lisa has a secret. Turns out a centuries-old code was hidden in the painting's artwork by its creator Leonardo Da Vinci. The code is obvious to those who know it's there. Yet to everyone else, including hordes of tourists, it goes unnoticed. You know what else goes unnoticed? The strategy will be discussing in this chapter. Like the Da Vinci Code, the strategy in this chapter is a secret which has been hidden in plain sight. Countless land investors have seen the components of the strategy, but they haven't put the pieces together. Just as viewers of the Mona Lisa never put the pieces together to see Da Vinci's code. Personally, I've never read the Da Vinci Code. I went the lazy route and watched the movie, and that's good news for you, as a reader because it means I can't go off on an extended tangent about the book. In place of a tangent, let's put the Da Vinci Code aside and move on. On to the land investing strategy, which is hidden in plain sight. In place of the Da Vinci Code analogy, I often use the idiom that sometimes the last thing a fish discovers is water. That is certainly the case with the portfolio takedown play. That's the strategy. You can think of it as analogous to buying a case of bottled water and then reselling each bottle separately. In this analogy, the case may have 24 bottles in it and cost you $12. If you then sell each bottle for, say, a dollar, you'll recoup your expenses in no time and make a few extra bucks of profit. The profit isn't mind blowing in this example, but being able to buy by the case and resell by the bottle should immediately resonate with you. Also the fact that you could efficiently secure the entire case of 24 bottles from a single source in a single transaction. Now imagine an alternative scenario where you buy one bottle of water at a time for 50 cents and then resell it for a dollar to someone else. Imagine doing that 24 separate times from 24 separate sellers. Sounds super inefficient and high touch. Well, that's because it is. Unfortunately, this is exactly the approach that 99% of land investors take to buy and resell properties. Why is that? You may be thinking. Well because like I mentioned earlier, sometimes the last thing a fish discovers is water. Most land investors are completely unaware that there is a way to purchase land, buying by the case instead of by the bottle. Costco for example is certainly a huge store carrying nearly anything that you can imagine. I honestly wouldn't be surprised, for example, to walk down one of the aisles and find a helicopter sitting there available for purchase. Despite the vastness of its selection, however, Costco doesn't sell vacant land. Yet, neither does Amazon, yet. The bottom line then is that cases of vacant land aren't readily available on an over-the-counter basis. So no, for a portfolio take down, you can't just buy the properties over the counter. Unless you are focusing on acquiring via a county auction, which is a different play for another playbook. How then do you get cases of off-market land to individually resell? You do it by finding those who own multiple parcels and then seeing whether these owners would like to sell some or all of their land. And our analogy with bottles of water, it's as though you're finding out which households own cases of water and contacting them, but not bothering with the households that only have one bottle of water. This is of course far more time consuming than just buying from a retailer. No one-click shopping, for example, as you'd find with Amazon. Then again, that's one of the reasons that portfolio take downs work so well. With the strategy you're creating unique opportunities that aren't available to anyone else. Well the opportunities themselves are unique. There is thankfully a standard process for creating them. I say thankfully because early on, portfolio take downs seemed more like lucky breaks to me than anything you could predictably plan for. In case you're curious about those early days, here's some quick background to how this fish discovered the blue ocean of water surrounding him. My first contact with portfolio take downs came when I encountered a seller who had 130 different parcels in his portfolio. These parcels hadn't been apparent to me at the time because I'd done exactly what most land investors do with their marketing list prior to sending out a direct mail campaign. That is I scrubbed out or removed duplicate entries. You know those owners with more than one property. So all of the 129 other properties that this particular owner had were removed from my list and my campaign. In theory, removing all the duplicates should make sense because of the apparent folly and focusing on duplicate data. This is the position presented in every online land course and by every educator I have ever followed. Time and again the line goes that we wouldn't want to send 10 different letters to somebody if they own 10 properties. Yet as it turns out this position on duplicates is completely wrong. I learned the error when Mr. 130 properties contacted me. He'd received one of my offers and wondered if I'd be interested in buying more of his properties. Thankfully I had asked if he owned any other properties and he shared that with me. At the time I didn't have the cash to purchase an entire portfolio of land parcels at once. Nonetheless I could buy the properties over an extended period. Recognizing this I arranged with the owner to do a release. During arrangement I would purchase the properties and batches over a set interval. In between purchases I would sell the lots so as to generate cash to buy more. Everything worked great apart from one glaring issue. The issue was that again I never saw buying in batches as its own land investing play. It just seemed at the time like I had a happy accident. A case of lady luck working her magic. Only with time and a few more appearances by Miss Luck did it occur to me that this might be the wrong view. I can still remember my epiphany moment because it was a single epic moment of awareness. You'd have to be a hardcore real estate junkie to relate I imagine, but it truly felt like the clouds opened. Bright lights shone from above and everything was revealed to me about the power of intentionally targeting duplicate owners. Well if the last thing a fish discovers is water that is analogous to how I felt when I had my duplicate owner or folio takedown strategy epiphany. Relating this epiphany to baseball it was as if instead of hitting a solo home run or even a grand slam. I had now found a way to step up to the plate, swing the bat once and score 20 runs. All at once and a single at bat. My understanding of the play developed gradually over time. I encountered variations on the same scenario enough to wonder whether it might be repeatable. This led to the realization that not all property owners were the same. That is to say, not all leads are created. equal. A property owner like my friend with 130 parcels was not the same as another person who owned just one parcel. In the context of land investing, Mr. 130 parcels was more valuable of a lead than the other fellow, that one parcel wonder. Building on this idea, it occurred to me that I should not be lumping all of the property owners into the same direct mail marketing campaign. Instead, it seemed a far better idea to separate owners and to lists based on whether they own multiple properties. Those on my list for multiple property owners would then receive different marketing than single property owners. This approach would allow me to potentially yield more acquisitions with fewer total marketing pieces and less marketing spin. I immediately recognized that not only would I have a potentially lucrative short list of high value leads, but I could target them intentionally and possibly even afford to run multiple campaigns since the number of records or recipients was way fewer than a traditional countywide direct mail campaign targeting every single owner. I remember sharing my enthusiasm about my discovery with my wife, Becca. I still remember saying, or look at this untapped gold mine of duplicate owners. I later taught the strategy in my land boss mastermind and had several members report back high six figure equity captures within months of adding this play to their playbook. This plays now the undisputed heavyweight champion of plays in the playbook when it comes to potential bang for your buck on marketing spend. I encourage you to double down on targeting duplicate and portfolio property owners. Jerry, one of the advanced investors in our group, recognized the power of the strategy immediately upon me revealing it. In under nine months, he reported back that he had captured nearly $800,000 of equity running this play. As an advanced investor, Jerry has provided great feedback on how he ran the portfolio taked on play and the different portfolio owner types he encountered and successfully negotiated with during his implementation of this play. Colin, another advanced investor in my mastermind, also immediately recognized and implemented the strategy and reported back that he had captured over $300,000 in equity within six months and had many prospective portfolio deals still in the works that would likely come to fruition. I don't tell you any of that to promise you any type of similar results. These are just real people who recognized the profit potential with this and took immediate massive action and because of it, experienced their best years ever as land investors. Just think about the lifetime value of adding this play to your playbook. Don't have hundreds of thousands of dollars laying around to complete a portfolio takedown. Well, this portfolio takedown strategy is suited perfectly to run and then leverage a capital partner for the money piece. The reason to use a capital partner would be to preserve or not risk your own money. Curious what this bang for your buck looks like with a funder? You can see it in an example with another land investor, one of my coaching students. By targeting those who own multiple properties in a county, the student was able to buy 20 pieces of land from a single owner. The parcels were acquired in one transaction for $193,000. Following acquisition, the 20 parcels were listed with all individual listing prices adding up to a total of $525,000. In this example, a total of $332,000 of assumed equity was captured. These parcels will all be subsequently sold off in multiple transactions, one bottle at a time, resulting in a huge win for all parties involved. I know those numbers, by the way, from the funding company I co-owned having provided the financial support for this deal. Well, the preceding example featured one of my students, you don't have to receive coaching from me to do portfolio takedown deals. Reading this chapter may be all you need to get started snagging your first portfolio parcels. To that end, let's turn now to the mechanics of it. This is the part of the show where we'll cover exactly what you do. Recall from earlier how we mentioned that prospecting for portfolio deals requires a different approach than in previous land investing plays. Part of the difference is that you're intentionally targeting those who own multiple properties. This can be seen as narrowing the scope of your prospecting efforts. Ironically, such narrowing should be accompanied by the broadening your efforts elsewhere. Narrow the field to multiple property owners. Then at the same time, broaden the scope of your marketing and mailing campaigns in order to hit multiple counties at once. I'd even recommend you think beyond the confines of a single state. And that way your campaigns would be for multiple property owners and potentially two or more states. The logic for going broader on counties and states is that it ensures you have enough owners to mail. How many is enough? That's a difficult question to answer. I've yet to find a magic number. It would therefore be wrong for me to suggest if you only mail x number of owners, then you'll get a portfolio takedown deal. All I can say is that you should probably market to as many multi property owners as possible as soon as possible. This is a numbers game after all. And when you pursue people who own more than one property, you're inevitably fined that the number of prospects is going to be a lot smaller. That's a negative on one hand since it means you may find individual counties where there are only say 200 people with multiple parcels. Yet having smaller numbers becomes a positive when you consider how it only takes one portfolio deal to be said. So for example, if you market or mail to 1000 people and your targeting efforts for a takedown play and only get one deal out of it, that can be a smashing success. The same cannot be said for mailing a thousand single parcel owners and a traditional direct mail county wide campaign. Naturally, single property owner campaigns still have their place. Portfolio takedowns aren't intended to totally replace them. In place of an either or dynamic, both strategies can be pursued simultaneously. Its single parcel owners and duplicate owners living together like hippies and peace and harmony. A fitting analogy here is one of a gym member. When we go into a gym, we can all appreciate the fit guy who is sitting at the counter, sipping on a protein shake after his workout. This guy represents the single parcel owner campaign. But how about the monster bodybuilder in the back who is grunting and growling lying underneath the bar and pushing up massive amounts of weight? This beast represents the portfolio campaign. Now, I'm not suggesting that running portfolio campaigns is cheating or you're going to get kicked out of the league of land investing for running them. What I'm trying to illustrate though is that a portfolio campaign is like a regular campaign on steroids where the potential results you get look nothing like the average results that others get from running regular campaigns. You see, running and converting on portfolio campaigns will leave your bank account looking jacked instead of just average. So going forward, whenever you think of portfolio takedown campaigns, try to think of them as steroids or performance enhancing drugs for your marketing efforts. Portfolio takedowns has noted moments ago begin with prospecting. Let me give you some specifics on how that's executed. In this way, we can ensure our discussion isn't just vague theory and will instead be practical nuts and bolts content. Two prospecting methods for portfolio takedowns. With prospecting, you've got two specific methods. Each method will enable you to identify and intentionally target portfolio owners. Method number one can be term portfolio sniping. When you follow this method, you target money. multi-parcel owners one at a time. This is akin to how a sniper uses extreme concentrated singular focus to take out or in this case take down their target. As you snipe for your portfolios you're looking from afar for portfolio owners and then zooming in to target each individual owner with laser focus. Such zooming is absent from the other method of prospecting for portfolio deals. Method number two is known as portfolio shotgunning. You trade the precision of a sniper rifle for the broad reach offered by a shotgun. In practical land focus terminology the shotgun method is about pulling a list of all the owners with extra more properties in a county. There tend to be three common portfolio owner types. Keep in mind as I share these three portfolio owner types they come from my experience and my students feedback. I fully understand that there are many other portfolio owner avatars but these are the three most common that I have encountered. First, investors. An investor in this context is an individual who's bought one or more properties every year or so over the last couple decades often at tax deed sales. The result is that Mr or Miss investor now owns 10 20 or possibly even 30 plus properties. Those properties will usually be rural vacant land. 50 acres are less in size and with a market value of approximately $50,000 or less. The second portfolio owner type builders. A builder is a property owner with two or three residential lots. The lots are usually great sites for building on yet the builder themselves hasn't built anything. Why? Well one explanation is that they never got around to it. Life happened to put it in another way. Alternatively the builder might have these lots left over as the final ones in their inventory. Lacking any motivation to build often because they're aging or in their sunset years of building homes and thereby winding down their career the builder might be more than happy to liquidate the remaining lots to you. Liquidation would liberate the builder from the burden of their remaining unused lots. The third portfolio owner type ranchers the term rancher signifies individual property owners who have two or more large acreage properties. We refer to them as ranchers because the vast acreages make the properties prime candidates to be used for ranches. How big are we talking? Usually the parcels owned by a rancher will come in individually at around 40 acres to 320 acres plus. That's a lot of land and it's often perfect for purchasing and subdividing into ranchettes. I.e. smaller parcels of 10 to 40 acres which provide the benefits of a ranch without the huge commitment and cost. Okay you know who to target now next let's get to how you target them. What you say to the portfolio owners in other words. As we do let me point out that some outbound marketing takes place prior to any spoken conversations. What I mean is that the initial outreach most likely with a direct mail campaign using a letter of interest or a cold calling campaign or a text messaging campaign will have already been done. That allows you to gauge interest or motivation to sell. So having laid the groundwork with direct mail cold calling or text messaging you'll now open the conversation to a multi property owner by asking whether they'd be open to selling some of their properties. Assuming an owner who you reach out to whether with method number one portfolio sniping or method number two portfolio shotgunning says yes to your inquiry you then proceed to qualify the properties. Qualifying is about seeing whether any of the available properties would actually be worth buying. For example maybe Mr. portfolio owner has 30 properties in their portfolio and you end up disqualifying 10 of them because they don't meet your acquisition criteria. You can start on qualifying by using my faster method. This is the same faster method from back in plain number one. As a refresher faster is an abbreviation for the following things to investigate when initially qualifying properties. F stands for floodplain and wetlands. A stands for access both legal and physical road access. S stands for slope. T stands for two or more comps nearby. E stands for exit strategy and the R stands for resale. When you use the faster method with qualifying portfolio properties you'll ask for example how's the access at the given properties. A lack of access would be a red flag and potentially grounds for not purchasing the specific properties that don't have road access. You'll also verify access yourself in addition to taking the seller's word for it. Now what about utilities? That's another concern to investigate and there are plenty more concerns where that came from. Eventually however you'll be finished with qualifying the available properties. From there the fund begins. This is the point where price makes its entrance. Price can certainly be the life of the party energizing your conversations with the portfolio owner. Still like the life of the party in an actual social situation price doesn't rush in. No it takes its time. Easy-in is though having just rolled out of bed and deciding to drop by. You can see this in the conversation with the seller as you only make an offer on properties qualified through the faster method. Moreover the offer comes later in the conversation. You start the conversation with the seller by complimenting them on their nice bunch of properties they have. Then after this you want to let them the seller know and be specific. Some of their properties didn't make the cut and you likely wouldn't be interested in those ones. This will swing the negotiation pendulum in your favor immediately but very passively and in a non-confrontational way. From here price finally saunters on in beginning with the ballpark range offer. This is an offer that sets the stage for future discussions on price. As the range part suggests the ballpark range offer is not a single fixed price. It's an offer bounded by two different values so as to provide a range of what you'd be willing to pay. Why offer a range instead of just cutting to the chase with a single specific take it or leave it offer price? Cutting to the chase. To answer that let's actually consider the phrase cut to the chase. It refers to action films and what are frequently their most exciting moments. Heroine chase scenes. Well a chase scene can be spectacular in its own right is usually more to the film than just the chase. Yes for argument sake some films are just about the chase. The Terminator is probably the clearest example since the film is really just one big chase. Still even in the Terminator it would be a mistake to just cut to the chase. You'd be missing out on tons of vital information. All you'd see would be Arnold Schwarzenegger slinging a shotgun and chasing some poor woman. Those little details from the film about killer robots and a dystopian future might escape you. Imagine then how lopsided your view of the Terminator would be. You might regard the film as simply a good chase movie. The listfully unaware of it's also be in a classic science fiction film and a warning as we enter an age of increased artificial intelligence. The point to this example of the Terminator is that you're at risk of missing a lot when you simply cut to the chase. That lesson applies directly to land investing when we're talking about portfolio deals. In a portfolio deal you're bound to miss a ton of important background information if you try cutting to the chase by immediately providing a single one price for everything offer. This is practically guaranteed because because of the fact that portfolio deals involve multiple properties. If you cut to the chase analogy, doesn't resonate with you, I would like to introduce another that is a little more direct. Don't try to close on the first date. Don't even think of or hint about closing the deal in the first call. Just expect that there will be four or more conversations or interactions. One property can be hard enough to get all the facts about in advance. We see that with blind offers where even the most experienced investors can be dead wrong in their valuation of a single parcel. If pricing one offer on one parcel stands to be so difficult, consider the added difficulty of making what's essentially a single blind offer on a set of properties. Don't do that to yourself. Instead, give yourself more flexibility, more breathing room, so to speak, on your offer for portfolio. The way to accomplish it is by beginning with a ballpark range offer. The ballpark range offer. The ballpark range offer allows you to gain a broad sense of a portfolio deal without rushing in too soon. You can acquire essential background information about the portfolio properties and avoid being locked into a single offer price. In addition, you can also get a reading on the owner of the portfolio's properties and what they the owner sees an adequate price. This latter point about the owner matters from the standpoint of saving time. You don't want to waste time on a portfolio deal if it's clear you and the owner are too far apart on price. Ballpark range offers prevent such a scenario. In a funny way then, this type of offer does cut to the chase, just not in the way that you might expect. In presenting your ballpark range offer, I recommend phrasing it along the following lines. We haven't been able to coordinate getting anyone out there yet on site to see the properties, but from a desktop analysis, it looks like your offer would fall in the range of between X and Y dollars, on the whole portfolio that is, on the properties at least that met our criteria. So what replaces X and Y above your range of offer price? For those I'd recommend offering your range of about 20%, that is a delta of 20% between your offer X and your offer Y. For example, if it was a portfolio of five $20,000 properties, that the total value is $100,000 in value. I would propose a range of 30 to 50% of that $100,000. If the properties in the portfolio were $100,000 properties and there were three of them resulting in a $300,000 value, then I might recommend you offer a range of 40 to 60% of that $300,000. Now these aren't rigid ranges. These examples illustrate the suggested range or difference between the minimum value and maximum value, which is 20% in this example. Yet we increase that minimum maximum value percentage as the property values increase. The takeaway is that you need to offer a higher percentage for higher value properties. Also to be clear, your ballpark range offer comes after qualifying the properties in a portfolio deal. Qualification happens in the same way as with any other property, solo or in a portfolio. You're doing a faster check for standard issues like slope, access, and whether the property lies in a flood zone. Qualifying properties also means pulling sold and for sale comps. Get those comps off a website like Zillow. Put them in a spreadsheet and calculate the average sold and for sale market prices. From your calculations, you'll arrive at a clear idea of values in the market. Pay close attention to the difference in correlation between the for sale and sold comps when establishing a value. As in most ascending or appreciating markets, I've found that sold comps are generally anywhere from 8% to even 15% lower than the for sale comps in most markets. The implication with this is that you don't always get what you list for. The sold price is usually less than the list price. However, in flat and descending or inverted markets, the for sale comps could actually come in lower than sold comps. For this reason, I encourage you to dig into the relationship between the two, as well as identifying what type of market you're currently operating in. After you've qualified the properties in a portfolio deal, you'll know which of the properties you'd actually want to buy, and what you might, generally speaking, offer for them. This takes us to the step mentioned earlier, where you drop the ballpark range offer. At this juncture, the seller has the ball in their court. The next move is theirs. The seller may reject your ballpark range offer flat out. In that case, the deal's dead, and you haven't wasted any time putting boots on the ground or sending people out to see the portfolio properties. Alternatively, the seller may put forth a counter offer. Mr. Miss seller might do it with a statement along the lines of, "Hey, I was thinking more in the range of Y to Z than your range of X to Y." If that's the tack the seller takes, you can respond with a statement like the following. If we're able to get someone on the ground to see these properties and they can support that range of Y to Z you proposed, would we have a deal? Provided the seller agrees to this, then you have the basis for proceeding onward. Onward to getting a real estate agent or agents to view the properties and provide you with their on-site opinions of value. Having agents involved affords you a real-world basis for pricing the portfolio. You move out of the realm of this should work spreadsheet calculations and into the state of boots on the ground knowledge that this is what things actually sell for. As this happens, you may realize your offer should be priced higher. Conversely, it may become clear to you that the offer you'd plan to present to the portfolio seller is a bit too generous. Generous to the point perhaps where you're at risk of running a charity versus a profitable land business. Don't beat yourself up. However, if the agent's opinion of value shatters your sense of pricing. First off, be grateful that agent has saved you from offering the wrong amount. On that, recognize the fact that offers on portfolios are nearly always custom. Customization is the norm because virtually any portfolio deal you encounter is going to be unique. A seller might, for example, have two or three infill lots in their portfolio that they're looking to sell. Suppose these infill lots are 1.25 acres each and located in Tampa, Florida. Now compare this portfolio deal to another one involving 20 rural vacant land properties of different sizes scattered across different West Texas counties. Actually on second thought, don't compare those portfolio deals to each other because the fact is you can't. The deals are each unique in their own right. Accordingly, each of those deals deserves an intelligent, fully customized offer. You get my point. Now customizing every single offer you make for seller portfolios can seem arduous. I'm not going to deny that yet it's worthwhile because portfolio deals are the 80/20 of land investing. A single portfolio deal, for instance, can allow you to scoop up 20 properties at once. Without such a deal, you'd have to acquire the properties one at a time over the course of 20 individual deals. Are you sold on doing portfolio deals? Then here are two closing thoughts on prospecting or portfolio deals. These thoughts will round out the discussion on prospecting so that we can move on to discussing execution. First, start where you stand. That's just a fancy way of saying you should start prospecting for portfolio deals in in the same places you're already working. Then, depending on how things go, you can branch out to other areas. Branching out might mean searching for markets with traditional indicators of success, think low days on market, or you might branch out by looking for areas where there's a sizable number of sellers who meet your required characteristics. Second, no blind offers. Portfolio deals and blind offers go together in a single campaign, about as well as pancakes and ketchup. Which is to say they don't. Blind offers, remember them? That's when you lead with an unsolicited purchase agreement for a predetermined price. They're an attempt to smoothly slide into deals. You can pull that off when the deals are easily compared to one another and only involve a single property. The same cannot be said when each deal lacks easy comparison and features multiple properties. This is the reality of portfolio deals. I recommend you send portfolio owners a letter of interest or use another outreach method like cold calling or text messaging. Just no blind offers initially because they can turn off or turn away a prospective seller lead due to an inaccurate, unintelligent, unsolicited offer. Execution, the heart of portfolio takedown deals. All right, execution time. Here's where we get to the heart of a portfolio takedown deal, discussing the acquisition and disposition sides of the play. On the acquisition side, you'll be acquiring multiple parcels of land in a single transaction. As with other land investing plays, a title company will assist you in the acquisition, provided you're in a state where laws permit title companies to close. This time around though, the title company will be handling multiple parcels as opposed to just one. The additional parcels aren't free and the title company will charge you extra for them. How much extra? Brace yourself. For a whopping average charge, per additional parcel of two to three hundred dollars. Wow, tons of money, right? No, of course not, especially when you consider that closing costs for a single parcel of land are approximately $1,250 on each, on both sides, meaning on the acquisition by side and on the disposition resell side. Now those amounts put the total cost to acquire and then dispose of one piece of land at $2,500 again, on average, if we paid 1,250 on the buy side, 1,250 on the sell side of title, we'd be at $2,500 per property. So faced with these facts, what's an extra 200 to $300 per property on the buy side? It's a bargain, that's what. A couple hundred dollars allows you to save thousands in closing costs. I don't know what your title company will charge you, but the most we have seen to date for an additional parcel is $400. You'd enjoy such savings, for example, if purchasing a portfolio of four properties. Individually, and with separate escrow's, buying from four different sellers, closing costs on four properties might total $5,000, which represents $1,250 per property per escrow times four properties. With all four of the properties under one roof, however, your total closing costs on the buy side could be a mere 2,150. That's 1,250 for the first parcel, plus three more parcels at $300 each. This is a savings of $2,850. Think of it like this, you're potentially saving approximately $900 for every additional parcel you buy or include in the same escrow. Now are these exact figures on closing costs? No, yet they can still serve as a useful indicator on the vast savings to be expected when you're closing on a portfolio of deals. Back in the days when I had to sit under fluorescent lights in the confines of a stuffy corporate meeting room, they called things like this, economies of scale. Ugh. It gives me the shivers just thinking of ever having to report to an office again, but my point here is really just to illustrate that the more parcels you add to the escrow or the acquisition, the greater the savings are. Well, we're on the subject of closing. You'll be relieved to know that title companies tend to be AOK with portfolio takedowns. The situation is refreshingly different than other land investing maneuvers, most notably double closings, where you need an investor-friendly title company. Title companies get it and will broadly speaking be able to help you close on portfolios of parcels. The only reason a title company wouldn't be able to help apart from it taking a personal dislike to you would be in cases of properties in different regions. A seller might have some of their portfolio properties in West Texas, a few more in Northern Arizona, and then the remainder in Southern New Mexico. To close on all of these properties, you likely need a title company that operated in each of the aforementioned states. As an aside, two potential here include First American and Chicago title. Each has branches around the country and could be just what you need, depending on which branch you're working with. When we do encounter a portfolio owner with multiple properties in different states, we typically find it smoother to close with a separate escrow for each state. Given that title companies or other closing agents according to what the local laws permit, play a central role in acquisitions and dispositions, there isn't much else to discuss here. Sorry to disappoint you if you'd like a lengthy desertation on the intricacies around acquisition and disposition of portfolio deals. But the fact is the heavy lifting in acquisitions and disposition collectively termed execution on a portfolio deal will mostly be up to the closing agents. Usually a title company. Can you follow the title company's instructions? Then you're in good shape where execution is concerned. All the same, don't get too relaxed. Portfolio takedowns are not a walk in the park. Yes, it's true that you're scooping up multiple properties from a single seller and probably getting a great deal in the process. Also, where transaction costs are concerned, you're indeed saving boatloads of money. And yes, closing agents will do the heavy lifting on the execution of the deal, acquisition and disposition, even with all that, however, portfolio takedowns can still present some challenges to pull off successfully. What could go wrong, you ask? Oh, my response would be how long do you have? Seriously, there's an endless array of things that could go wrong when you're attempting a portfolio takedown. Now, I don't mean to scare you. My aim is just to avoid unrealistically portraying this land investing play as somehow being effortless. It's not, and you ought to be aware of that. It can, however, have such a radically positive impact on your business that just one can be a complete game-changer. You're just one portfolio takedown away from. You fill in the blank, it's that impactful. Continuing that thread of things to be aware of, though, let's make sure you're aware of what to do and what not to do where portfolio takedowns are concerned. Do's and don'ts for play number six. One, do dig your well before your thirsty. The point here is that you should start lining up the targeting of portfolio owners immediately. Reach out to them as soon as possible and begin figuratively digging your well of deals now rather than waiting until you're in need of a large deal. Digging in advance puts you in a position of strength when approaching a portfolio deal. You won't need the deal, you'll want it. And where negotiations are concerned at that position, want versus need makes all the difference in the tonality of your voice. Two, don't be intimidated. We brushed on this a moment ago when I stressed that my goal wasn't to scare you to build on that point now, you really shouldn't be intimidated by the portfolio takedown play. The prospecting side of this isn't complicated. As you've seen in this chapter's discussion of it, is for the rest of the play, particularly areas like Doo. diligence, there's no glossing over the complexity. Yet with a levelhead, a willingness to learn, and guidance as needed from credible sources, title companies, agents, and perhaps even a coach, you can easily navigate the complexities. We will talk about this more in a minute, but having your capital in place ahead of time will also allow you to negotiate from a position of confidence versus having to posture and find yourself squirming in your seat when asked about funds or proof of funds. Three, do follow up with sellers. The fortune is in the follow-up. Is a catch your way of expressing this do. It conveys the point that follow-ups result in deals getting done. Portfolio takedown deals should involve much more emphasis on rapport building than you may be used to. If you're comparing them to deals where you're converting the acquisition of a single parcel from a single parcel owner. Naturally, there will be more back and forth and saying what you do, follow it up by doing what you say, can really go a long way in building trust with the seller. Don't try to close the deal on the first date. When approaching portfolio takedowns, there should be a courting period. Remember that. Throughout the course, the portfolio review and negotiation process. For, don't target portfolios based on what you can personally afford. Remember how we said the fortune is in the follow-up. As it turns out, the money is also in the hands of countless people who would love to fund your land deals. I happen to be one of those people and there are plenty of others too. You may also have a rich uncle or some other person who will lend you money cheaply. Taking all these avenues for funding into consideration, you'll realize that it's a mistake to only go after the portfolio deals you can personally afford to buy. There's no need for that when there are so many sources of funding available. Another exit strategy in addition to funding is to assign the purchase contract on a portfolio takedown deal. This can result in potentially larger assignment fees than you ever thought possible. Number five, don't jump to price immediately. Price has a place and portfolio deals. There's no denying that. You just don't start with price. Otherwise, you run the risk of missing critical details. Remember our analogy with the Terminator and squandering the chance to build rapport and trust with the seller. Number six, do question why other land investors are sleeping on portfolio takedowns and not doing them. Why is that? I've certainly wondered as you might. From what I can gather, it's a combination of a few factors. Portfolio deals require more work than other type of land deals, both in prospecting and in negotiations. That's probably a main deterrent, as is the substantial capital required to purchase a portfolio. Let's also keep in mind that every land investing course historically, to my knowledge, at least teaches you to scrub out duplicate owners. On top of that, even if you were to somehow leave in a duplicate owner, the courses would have you believe that every owner should get the same treatment. Yeah, send the same offer to a single property owner as you would to the owner of 50 properties. Bright idea, right? No. Those with more than one piece of land should be segmented out and receive marketing or outreach that reflects that. Still, if the prevailing wisdom is to treat everyone the same, who might argue? I'd rather save my words for those who will listen, namely you, the reader and my coaching students or members of my community, and then take action. Until I spearheaded and started evangelizing intentionally targeting duplicate owners and portfolio owners, this was not a play, any investor or educator was intentionally running. I know because I pinged everyone in my network. I would get the same response. That is so obvious. Yet so brilliant. We have all been standing on top of an untapped gold mine, and I am thrilled to be able to share this play in the playbook is I believe it can have a seven figure impact on your business. Here's a recap now and what we just covered. It's a quick review of the essentials in this play. The review being what we've termed an executive summary. Executive summary of play number six, the portfolio take down play. Here are the five essentials for taking action on the portfolio take down play. Those essentials as in earlier chapters are centered around mindset, skill set, capital, connections and tools. Mindset. Got money on the mind? You'd better not. It's a mistake to be thinking purely of the money when beginning a portfolio take down deal. You don't have to be mother Teresa or some other saint like figure who's somehow above money. The idea is simply to focus on building rapport during the early phases of a portfolio deal. Rit yourself of the peer dollars and sense view where a deal is just another transaction on the books. It's about relationships and building a connection with the seller and understanding their unique situation and the reasons for potentially selling their entire portfolio to you. When the money does enter the picture for a portfolio deal, the important thing is to make sure you've also got the right mindset there too. Portfolio deals are about understanding the economies of scale and acquiring multiple parcels at once from a single seller. This results in having a view of money as being elastic with a single sum being stretched like a rubber band to tie up multiple parcels. Skill set. One of the most important skills for portfolio take downs is the ability to find property ownership data and organize it into a mailing or marketing list. Provided you can do that, you'll be able to prospect for portfolio deals. From there you'll need strong phone skills and the skill of knowing when to follow up versus when it's being pushy. Quite often when using a data source to pull a marketing list, there's a single field that says something like minimum number of properties owned and that one small field can have a huge impact on the potential profit of each lead on your marketing list. Capital. Remember the dig your well before your thirsty? Well this line also applies well beyond just prospecting for portfolio deals. We can apply it to capital where you'll definitely want to dig a well of deal funders long before your thirsty for their capital to do portfolio deals. Knowing you have access to large amounts of capital prior to entering negotiations with sellers about portfolios will put you in a position to confidently converse and negotiate. As a result you won't have to posture or squirm in your seat when the seller asks if you have the money on hand or they want to see a proof of funds. Connections. We've covered one of the most important connections in the last point with the talk of deal funders. Alongside that connection another would be a local land agent. That's local in the sense of the agent serving as your boots on the ground expert in the market or markets where the portfolio deal is located. With an agent like that you can bring them in during the advanced stages of negotiating and offer and get invaluable feedback on your offer price. Also the agent can provide the deal as well along visit each property for you. In this way you're getting a co-pilot someone to provide feedback on the deal and catch things you may have missed. A title company can help you as well as in catching things you've missed. So add them to your list of connections too. The last connection that is vital is that other advanced investors whom you can potentially assign the portfolio purchase agreement to. This additional exit strategy is incredibly powerful and grossly underused but it's also dependent on you not operating as a solo pranier. You will want to be connected with a network of advanced investors. Tools. You will need a data source capable of pulling targeted lists of a duplicate aka portfolio owners. A CRM software and follow-up system is also critical for capturing and converting leads. Since tools are always changing if you're looking for an up-to-date list please visit thelaninvestorsplaybook.com and click on Tools. All right you've completed another chapter. armed with another play in your land investing playbook. If you're enjoying the content so far and you recognize the potential lifetime value of plays like this portfolio take down play, I would love to have you check out my website the landinvestorsplaybook.com and click on Mastermind. For those interested in joining my mastermind, many of these plays came from my mastermind. Within this book, I can share with you the strategies but I can't show you where to click your mouse or exactly how to go about these campaigns. You have an opportunity to purchase the courses associated with the plays in this playbook as well as join my mastermind and get access to everything. So I definitely encourage you if you see the lifetime value potential in these plays, I'd like to encourage you to go to the landinvestorsplaybook.com and click on Mastermind. Now as a gesture of my gratitude for your dedication, I want you to enjoy a massive discount by using the coupon code playbook. All right, eager for more insights? Let's journey into the next chapter and continue to unlock the treasures of this playbook.