1 00:00:00.720 --> 00:00:03.810 Johny Fernandez: New Jersey commercial real estate investor Bruce Cenicola. And 2 00:00:03.810 --> 00:00:08.160 Daniel De Stefano had been friends since they were teenagers. Years later, they 3 00:00:08.160 --> 00:00:10.920 became commercial real estate investors and partners 4 00:00:10.990 --> 00:00:15.640 Daniel De Stefano: I come from a family of barbers. I was a barber. And I had 5 00:00:16.360 --> 00:00:21.700 gotten a residential real estate license, then got VA with a partner who 6 00:00:21.700 --> 00:00:29.260 is my accountant. And we tried to do a deal together and it fell through, I 7 00:00:29.260 --> 00:00:33.160 didn't have any money, and then we borrowed some money. And we were able to 8 00:00:33.580 --> 00:00:40.870 build our first building. And I did that in probably 1972, I was 22 years old, 9 00:00:40.870 --> 00:00:49.420 and just came home from Vietnam. And probably some years later, maybe seven 10 00:00:49.420 --> 00:00:55.450 or eight or ten. A couple of buildings later, then Bruce, who I've known since 11 00:00:55.450 --> 00:01:02.470 I was 13. And, and our other partner, Al, I brought them in and they became 12 00:01:03.040 --> 00:01:07.150 equal partners. And we just developed from there on out, I guess you can add 13 00:01:07.150 --> 00:01:07.250 Bruce Cenicola: The first deal that Al and I were in with Danny turned out to 14 00:01:07.450 --> 00:01:07.540 to that. 15 00:01:15.220 --> 00:01:22.090 be it turned, it got turned down by the town where we wanted to build. And we 16 00:01:22.090 --> 00:01:28.120 thought we made a big mistake. And we had invested a lot of money in lawyer 17 00:01:28.120 --> 00:01:36.460 fees, and engineers and so forth. And so we were very disappointed. And as it 18 00:01:36.460 --> 00:01:41.320 turned out, we'd sold the property for a profit. And it turned out to be a very 19 00:01:41.320 --> 00:01:46.870 good deal. And as it turned out, it went on and we got involved in many more. 20 00:01:46.870 --> 00:01:50.530 Johny Fernandez: The decision was life changing. The men have spent nearly the 21 00:01:50.530 --> 00:01:54.430 last several decades building their business. Their piece of advice for 22 00:01:54.430 --> 00:01:57.640 freshmen commercial investors is to do your homework first. 23 00:01:57.910 --> 00:02:00.460 Bruce Cenicola: They need a little bit of an education to get started 24 00:02:00.490 --> 00:02:04.300 Daniel De Stefano: You can't just you can't wing it like we did, right. And I 25 00:02:04.300 --> 00:02:07.180 don't know that they want to replicate what we did, you can't go borrow a few 26 00:02:07.180 --> 00:02:11.560 bucks and get a mortgage, and borrow a few more dollars and put together a deal 27 00:02:11.560 --> 00:02:16.900 and then get another mortgage. And it's not quite that simple anymore. It just 28 00:02:16.900 --> 00:02:20.890 takes so much money nowadays to get to get started 29 00:02:21.100 --> 00:02:23.650 Johny Fernandez: Tnhe day we caught up with them. They showed us one of their 30 00:02:23.650 --> 00:02:28.180 several spaces in New Jersey, walking us through the large renovated shopping 31 00:02:28.180 --> 00:02:32.830 plaza, home to a variety of restaurants and businesses. How do you know if a 32 00:02:32.830 --> 00:02:38.230 property or space is a good investment versus something that, you know, may 33 00:02:38.230 --> 00:02:40.180 sound good, but may not be good? 34 00:02:41.260 --> 00:02:44.500 Daniel De Stefano: I think some of those are just experience, experience and 35 00:02:44.500 --> 00:02:48.940 experience. I mean, you know, gut feelings and and we both had research. 36 00:02:49.270 --> 00:02:54.070 Oh, yeah, a lot of research. But I think we both had experiences where I've said, 37 00:02:54.070 --> 00:02:57.190 Bruce, come and look at this, I think it's great. And he'd get out there and 38 00:02:57.190 --> 00:03:01.780 say, are you kidding me? You want to buy this or and the same thing in reverse or 39 00:03:01.780 --> 00:03:05.680 with one of the other partners? It just you know how it kind of catches you and 40 00:03:05.680 --> 00:03:10.270 so forth. But I think it's you know, the kind of the gut feelings and the 41 00:03:10.270 --> 00:03:17.290 research. A nice lot the building across the street, what's zone, what's around 42 00:03:17.320 --> 00:03:21.760 those kinds of things. Like that's worked for us. 43 00:03:21.810 --> 00:03:24.690 Johny Fernandez: Bruce and Danny shared with me their tips for how to make sure 44 00:03:24.690 --> 00:03:28.470 freshmen investors should handle their finances. You guys have been doing this 45 00:03:28.470 --> 00:03:31.920 for years. And for someone that's freshly starting out, what do you think 46 00:03:31.920 --> 00:03:35.370 they should be on the lookout for when it comes to dealing with like a bank or 47 00:03:35.370 --> 00:03:37.710 a lender? What advice would you give to them? 48 00:03:37.710 --> 00:03:41.170 Daniel De Stefano: Shop around. You know, certainly because there's there's 49 00:03:41.170 --> 00:03:48.610 major major variances in different deals and what banks will offer and what banks 50 00:03:48.610 --> 00:03:49.390 won't offer. 51 00:03:49.469 --> 00:03:53.009 Bruce Cenicola: And I think a good idea would be to develop a relationship 52 00:03:53.009 --> 00:03:58.469 right? with a particular bank, somebody that you can pick up the phone and talk 53 00:03:58.469 --> 00:04:07.139 to. Maybe, you know, maybe it's your personal bank, you know, maybe not, but 54 00:04:07.499 --> 00:04:11.339 I think you need some kind of personal relationship, which you know, takes time 55 00:04:11.639 --> 00:04:18.899 to do. But yeah, once you get started, right, it kind of snowballs. It'd be 56 00:04:18.899 --> 00:04:24.149 nice if you had access to some capital, like family money, good friends with a 57 00:04:24.149 --> 00:04:28.889 lot of money that are willing to invest. That that's probably the easiest way to 58 00:04:28.889 --> 00:04:29.219 do it 59 00:04:29.540 --> 00:04:33.110 Daniel De Stefano: is start small, maybe a couple of two family houses or, you 60 00:04:33.110 --> 00:04:37.070 know, one or two stores, maybe you get into a situation with the seller will 61 00:04:37.070 --> 00:04:42.380 take back a mortgage or something like that. Try to get started. Try not to 62 00:04:42.380 --> 00:04:48.350 suck every dollar out of it. Slow mature. Now, again, I said a minute ago 63 00:04:48.350 --> 00:04:54.140 about being conservative. I mean, slow maturing, is what we did and and I would 64 00:04:54.140 --> 00:04:58.970 do that all over again. But the guy who came along and bought this and then that 65 00:04:59.060 --> 00:05:03.140 we got mortgage on top mortgage on top of mortgage mortgage, probably made a 66 00:05:03.140 --> 00:05:07.670 ton of money and made a ton of money As long as things were going good. Once 67 00:05:07.670 --> 00:05:12.230 there's a hiccup, you know, now there's another issue. Well, I think that if I 68 00:05:12.230 --> 00:05:14.810 was doing it over, I would do it just the way we did it now, 69 00:05:14.990 --> 00:05:18.230 Johny Fernandez: the veteran investors say not everything that shines is a good 70 00:05:18.230 --> 00:05:22.400 deal. And then one tip that has kept them afloat is to prepare for the 71 00:05:22.400 --> 00:05:23.210 unexpected. 72 00:05:23.300 --> 00:05:26.000 Bruce Cenicola: I think the main thing is prepare yourself for the downtime, 73 00:05:26.210 --> 00:05:28.010 because there will there be doubt there will 74 00:05:28.010 --> 00:05:32.390 Daniel De Stefano: There will absolutely be down times, I can tell you with 100% 75 00:05:32.390 --> 00:05:36.890 certainty that the stock market does not go up every day all the time. And it 76 00:05:36.890 --> 00:05:40.490 doesn't go down every day all the time. And the real estate market doesn't 77 00:05:40.490 --> 00:05:45.170 always go up. And it doesn't always go down. There's ups and downs. I think 78 00:05:45.320 --> 00:05:53.330 adding to what Bruce said a second ago, I think that not taken not trying to 79 00:05:53.330 --> 00:05:58.670 suck the company dry. Don't take every penny out, because you're going to need 80 00:05:58.670 --> 00:06:05.000 some next month or next year. And and I think that philosophy has paid very good 81 00:06:05.000 --> 00:06:10.310 dividends for us. I mean, we've had a vacancy and whatever it is, we were 82 00:06:10.310 --> 00:06:15.950 drawing, you know, we had money built up. So you know what we were able to 83 00:06:15.950 --> 00:06:21.020 draw we you know, it stayed the same, and they wipe it down. But I mean, he 84 00:06:21.050 --> 00:06:28.130 tried to keep it stable because we didn't take Maxi mortgages. It worked. 85 00:06:28.160 --> 00:06:34.160 It worked good for us. If you suck every penny out of it. As soon as there's a 86 00:06:34.160 --> 00:06:39.620 bad time, you know, you have four stores and one of them goes out of business. 87 00:06:39.860 --> 00:06:45.380 Now, what do you do? You know, it's great when it's 100%. rented. Oh, my 88 00:06:45.380 --> 00:06:50.840 goodness, I'm making 27%? Yeah, well, if you lose 25%, now you're only making 3% 89 00:06:51.500 --> 00:06:51.800 or 2%. 90 00:06:52.230 --> 00:06:55.260 Bruce Cenicola: So what he's saying is, don't lease the Mercedes yet. 91 00:06:55.380 --> 00:07:00.840 Daniel De Stefano: Yes. That's right. That's exactly right. That is 1,000%. 92 00:07:00.840 --> 00:07:01.230 Right. 93 00:07:01.529 --> 00:07:04.409 Johny Fernandez: And when it comes to getting financing, the men shared with 94 00:07:04.409 --> 00:07:06.299 me that they've all worked as a team, 95 00:07:06.390 --> 00:07:10.470 Daniel De Stefano: I think it's much more difficult to get money now than it 96 00:07:10.470 --> 00:07:14.850 was years ago. I mean, you know, years ago, you know, you knew somebody at the 97 00:07:14.850 --> 00:07:19.290 bank, he had a little bit of a relationship with them, and so forth. I 98 00:07:19.290 --> 00:07:25.890 think getting money was a lot easier. And I think years ago, we did a lot of 99 00:07:25.890 --> 00:07:30.900 private money, where we would borrow literally borrow money from from people, 100 00:07:30.900 --> 00:07:35.610 we go to you and if you had some money, you got $50,000. Well, if it's in the 101 00:07:35.610 --> 00:07:41.070 bank giving you 2% we'll borrow it from you, it will give you four and a half 102 00:07:41.070 --> 00:07:48.510 percent. And, and and do we do that dozens of times? I mean, not one or 103 00:07:48.510 --> 00:07:54.450 three or five, a lot, a lot. And we've had situations where partners, some 104 00:07:54.450 --> 00:07:57.510 people had more money than others, some of the partners had more money than 105 00:07:57.510 --> 00:08:02.820 others. So everybody put up $20,000 and anybody who's got any more money, 106 00:08:03.000 --> 00:08:07.110 they'll lend it to the company. And we've done those things. Our partner Al 107 00:08:07.110 --> 00:08:13.980 did a lot of those a lot of those deals and figured out a lot of those deals. Al 108 00:08:13.980 --> 00:08:20.700 was the most studious of all of us. Allen, Bruce and I went to high school 109 00:08:20.700 --> 00:08:27.030 together, we know each other for 60 years. And I can still hear Al out 110 00:08:27.030 --> 00:08:32.850 saying oh my god, you want to spend what? How much? and he used to go this 111 00:08:32.910 --> 00:08:37.860 uncharted territory. Is that right? That's correct. 112 00:08:38.520 --> 00:08:39.060 Bruce Cenicola: That's a true. 113 00:08:39.330 --> 00:08:43.140 Daniel De Stefano: So I hope that answers your question, but study and be 114 00:08:43.140 --> 00:08:44.550 conservative and do your homework. 115 00:08:47.610 --> 00:08:49.410 Bruce Cenicola: That's it. In a nutshell. 116 00:08:50.070 --> 00:08:53.160 Johny Fernandez: In New Jersey. I'm Johnny Fernandez with deBanked News.