00:04.080 --> 00:07.050 Sean Murray: Hello, welcome back. I'm Sean Murray with deBanked. tv. 00:07.050 --> 00:12.310 Johny Fernandez: And I'm Johny Fernandez. Sean, happy Monday. It's good to be back. Good to be here with you. Good to be here with everyone 00:12.310 --> 00:15.340 watching this live. So you want to jump straight into it? 00:15.370 --> 00:15.910 Sean Murray: Why not? 00:15.970 --> 00:21.100 Johny Fernandez: Alright, let's do it. So Sean, let's talk about the latest regarding the Federal Trade Commission. What's going on with 00:21.100 --> 00:27.250 that? I know, it's been a very interesting story. We were talking about it earlier, and just how that's played an effect in another story that 00:27.250 --> 00:28.360 we're going to talk about today. 00:28.510 --> 00:35.890 Sean Murray: Sure, yeah. So I think you're talking about the recent Supreme Court decision. And it's incredible that we're even talking 00:35.890 --> 00:43.630 about the US Supreme Court, we always think it's about hot button issue that decide presidential elections and in all the light, right? But here 00:43.630 --> 00:51.730 we are reporting on a actual Supreme Court decision that has impacted things in the financial services industry. And people we even know. 00:51.730 --> 00:52.450 Yeah. 00:52.450 --> 00:53.740 Johny Fernandez: And that reported on before. 00:53.740 --> 01:00.470 Sean Murray: And that we've reported on before. And so just to give everyone a background on what happened, basically a big payday lending 01:00.470 --> 01:11.570 company called AMG Capital Management, they got a judgment against them for $1.3 billion. It was obtained by the Federal Trade Commission, this 01:11.570 --> 01:20.510 was at least so several years ago, and at that time, it was the largest judgment that the FTC had ever gotten to litigation. $1.3 billion. And 01:20.510 --> 01:31.130 they-- It's a lot of money. Yeah. And so it was huge news at the time. And what they did is they went and they effectively took all the assets 01:31.160 --> 01:39.260 of the person who owned the company, a guy named Scott Tucker. And Scott Tucker, ultimately went to prison. He then did actually in prison right 01:39.260 --> 01:48.440 now for for things related to payday lending, you know, this whole thing. But he appealed the judgment, the $1.3 billion dollar judgment 01:48.440 --> 01:56.690 from the FTC saying that they didn't have the statutory authority to get that type of restitution, because they taken the 1.3 billion or at least 01:56.720 --> 02:04.220 whatever they were able to get, you know, hundreds of millions. And they've given it all back to, you know, the victims or whatever. And his 02:04.220 --> 02:11.210 argument was that they didn't have the authority to do that. And it was an interesting argument, because the FTC has essentially asserted that 02:11.210 --> 02:19.700 authority for like, 40 some odd years. So no one really paid any mind. He appealed it, he lost and the appeal the United States Supreme Court, 02:19.730 --> 02:28.340 who actually agreed to take on the case. And all eyes are on it, because there was an oral arguments hearing several months ago, in which it 02:28.340 --> 02:39.380 seemed, might be the Justices of the Supreme Court were sympathetic or under understanding of the payday lenders, arguments. And in fact, last 02:39.380 --> 02:49.310 week, they decided nine to zero, that the FTC did not have the authority to seek restitution under this provision, in which they sued the guy, 02:49.310 --> 02:57.320 which is something known as section 13(b). And so what the FTC does when they go after a lot of bad guys, is that they assume under something 02:57.320 --> 03:04.880 called section 13(b), it allows them to not only get an injunction, but historically it has enabled them to go and get restitution too through a 03:04.880 --> 03:12.080 judgment. And so this guy, Scott Tucker, effectively has won his $1.3 billion back. 03:12.950 --> 03:19.790 Johny Fernandez: Which is crazy. To think about, because this simple fact that he's essentially winning. 03:20.150 --> 03:26.090 Sean Murray: He won, he won. So he, you know, he essentially, the the, the original judgment was overturned, he's still in prison, you know, he 03:26.090 --> 03:26.930 still had-- 03:26.930 --> 03:27.980 When he gets out, I mean... 03:29.160 --> 03:36.510 You know, it'll be interesting to see what happens in that regard. whether or not he gets the money back or whatever, you know, keep in 03:36.510 --> 03:46.080 mind, this has already been distributed. The FTC has already given all the money out. At least that's my understanding. And the reason it's so, 03:47.070 --> 03:55.830 so newsworthy, right, because we don't really report on payday lending you Is it because the FTC has been very active. Lately, in the field of 03:55.830 --> 04:04.920 small business finance. We had someone from the FTC speak at Broker, Fair, Broker Fair Virtual last June. And they were talking about how 04:04.920 --> 04:13.560 they intended to be a lot more proactive, and policing, the small business finance industry. And so this has taken away probably one of 04:13.560 --> 04:22.740 their most instrumental powers, the ability to get restitution, when they sue someone under Section 13(b), they can still get restitution, if 04:22.740 --> 04:29.850 they see you under different clauses of the FTC act or whatever. It's very technical stuff. But apparently, it's a lot harder to do. And so 04:29.850 --> 04:32.790 the FTC is very, very upset about this news. 04:33.090 --> 04:41.400 Johny Fernandez: So this definitely ties into another story that we talked about, because obviously, this has essentially affected this 04:41.400 --> 04:49.110 lawsuit regarding Yellowstone, and we have reported on you know, we've been following that story. But the new developments of this specific 04:49.110 --> 04:52.800 story, kind of go hand in hand with what happened here with the FTC. 04:53.170 --> 05:00.820 Sean Murray: Yeah, so we haven't really, I don't think we've on the show talked about Yellowstone Capital too much. They were At least at one 05:00.820 --> 05:08.470 point, one of the largest merchant cash advance providers out there in the country. I don't know where they stand now. But they were sued by 05:08.470 --> 05:20.350 the FTC. I think it was late last year, sometime last year. And they were sued under Section 13(b). That's the provision that the FTC just 05:20.350 --> 05:29.710 had essentially revoked. You know what I mean? So this was like, huge news. And my first thought was, oh, my goodness, what happens to some of 05:29.710 --> 05:35.740 these lawsuits that are already taking place? Because if they no longer have the ability to get restitution, obviously, I think that's a lot of 05:35.740 --> 05:43.270 what they're seeking. And wondering when they're bringing the cases. Right. I know what happened in that case? Well, literally 05:43.270 --> 05:51.460 simultaneously, with the announcement of the Supreme Court decision, and announcement from the FTC goes out, but said that Yellowstone, had 05:51.460 --> 05:59.950 already agreed to settle the case against them. And they agreed to pay, like $10 million, or something. I think it was it was around $10 05:59.950 --> 06:09.730 million. And they were going to comply with all this monitoring and all this other stuff. And people be like, Oh, well, no, of course, it's 06:09.730 --> 06:18.580 settled. The FTC is, you know, in trouble, they have no choice. But that settlement like, well, that settlement technically, did not have to be 06:18.580 --> 06:27.310 entered into, at least from my opinion, I'm not a lawyer. Right? Had they waited? I guess, right. Because if, if the FTC no longer have the 06:27.310 --> 06:35.620 power to get this type of judgment, then perhaps it would have been worth it to wait. I don't know. I don't know. I'm just completely 06:35.620 --> 06:42.190 spect--. I don't know anything behind the scenes. But the settlement was announced. And I guess I guess the these documents were signed prior. So 06:42.190 --> 06:50.770 they entered the settlement before, and they couldn't know that this was gonna happen. Right. But it is interesting that it came out. And I think 06:50.770 --> 06:57.730 that some people are looking at the $10 million judgment. And they probably feel that it's quite small compared to what they originally 06:57.730 --> 07:07.780 thought might happen in all of it. And so I think that it's interesting that companies who have been affected by it are now having all sorts of 07:07.780 --> 07:14.800 different outcomes than that what what they probably otherwise would have had, like, for instance, the Yellowstone FTC thing is now over by 07:14.800 --> 07:21.490 virtue of the settle-- Yeah, they had paid money. But it's over yet. I mean, yeah. And they actually, if you read it, it said they didn't admit 07:21.490 --> 07:30.340 any wrongdoing. They're just like, you know, pay the fine. comply with some things. And that's already one impact of this FTC. Supreme Court 07:30.340 --> 07:30.850 decision. 07:30.960 --> 07:36.660 Johny Fernandez: Yeah. It's interesting. And we'll definitely, I mean, it'll be interesting to see out just everything with Yellowstone, and 07:36.660 --> 07:43.470 the FTC and how it ends up playing out, obviously. So he'll be it's definitely an interesting topic, especially how things are changing. 07:43.500 --> 07:50.760 Yeah, you know, and things are developing. Because, you know, one moment we know, we're looking at things a certain way, then the next things 07:50.760 --> 08:02.730 just change. So, it's a wild world. I see it. Alright, so the next topic, Sean, and it's something that, you know, we've talked about, and 08:02.730 --> 08:11.970 it's pretty much down the path of, you know, either making quick money or making passive income, especially after something like Coronavirus, 08:12.210 --> 08:21.990 you know, we're kind shuck everyone. Is house flipping, fix and flip, and the real estate market and how, you know, I've been reading a couple 08:21.990 --> 08:30.270 of different articles. There's one specific one that caught my attention. And it's this investor, she's an investor, she helps females 08:30.270 --> 08:37.980 specifically learn how to flip. It's called Chicks Who Flip. She teaches them pretty much essentially, from start to finish, you know, what to 08:37.980 --> 08:45.840 look for, the process, you know, investing how to flip properly. And then when the income is like, when you sell your house, when you buy the 08:45.840 --> 08:54.900 house, sell it, you know, kind of how to really pick up essentially, the right contractors and what essentially is needed, you know, and pretty 08:54.900 --> 09:04.410 much that money is used to gain wealth. And she specifically aims for females, especially this year that have either lost a job, she went 09:04.410 --> 09:10.590 through something very similar, where she was divorced. It was an abusive relationship, and she needed income. And she got into it. And 09:10.590 --> 09:17.400 she really hasn't looked back ever since. So it's a really interesting or, like, you know, program that she has, but I think, especially this 09:17.400 --> 09:26.190 time, like working in real estate, you know, I've read reports that, you know, flipping just in 2020, alone, generated a gross profit of about 09:26.190 --> 09:37.320 $60,000. Nationwide compared to 66,000. Nationwide compared to 2019, when it was just that 62,000. So definitely a bit a pattern when people 09:37.320 --> 09:45.990 are getting more money, the market itself, overall, it's changing nationwide, like, you know, we see a lot of people you know, I've seen 09:45.990 --> 09:53.010 it, especially now, where a lot of people from New York, New Jersey, Connecticut are going down in places like Texas, Florida, the Midwest, 09:53.340 --> 10:00.720 and they're buying a house for less than $100,000. They're putting money in and they're flipping and quickly and they're gaining, you know, their 10:00.720 --> 10:09.720 ROI is anywhere from, you know, 60 to $80,000. You know, depending on where they're at in the country. And there's also another article that I 10:09.720 --> 10:19.260 read before we got on here today, he was on CNBC, regarding unexpected flipping, which is pretty much you know, they were talking, and we've 10:19.260 --> 10:25.980 talked about it, the South Florida market in Miami, which we know it's booming, we know that there's a lot of tech investors, there's a lot of 10:26.580 --> 10:34.800 finance, you know, people heading down, they're opening offices down there. And what's interesting is that some people will, and they were 10:34.800 --> 10:42.780 saying this in the article, they'll buy a house for, you know, $6.1 million, and you know, something happens where within a week, they 10:42.780 --> 10:47.910 change their mind, because they have the money to do it. They're like, you know, what, we're gonna stay here, we found a better house, and they 10:47.910 --> 10:56.550 sell the house. And within two weeks, he gained anywhere from a million to $2 million. And he's an unexpected, you know, profit of flipping. But 10:56.550 --> 11:04.080 because of how everything go, how everything's going right now, that's, you know, how the market works, you know, in places that are hot, or in 11:04.080 --> 11:11.670 places where there are inventory in places like Delray Beach, Florida, where, you know, there's an opportunity to do that. And, you know, you 11:11.670 --> 11:17.430 can accidentally flipped and sell, you know, people are selling their houses within a week. And then they're gaining more money, because 11:17.430 --> 11:24.210 they're putting them back on the market for more, which is part of flipping but it's wild to think that that's the reality of that's what's 11:24.210 --> 11:24.780 going on. 11:25.140 --> 11:33.120 Sean Murray: It sounds honestly, the way you're describing it sounds a little bit like what was happening and like, '06, '07. Especially in 11:33.120 --> 11:41.040 Florida. Where you buy a house with the intention of trying to sell it like the next week, you know what I mean, for a lot more. And I think, 11:41.040 --> 11:43.320 you know, the real estate market is extremely hot. 11:43.320 --> 11:50.170 Johny Fernandez: Yeah, it's extremely hot, especially down south, especially in places like South Florida, I have a couple of real estate 11:50.170 --> 11:57.640 friends that are working in Texas, and, you know, in Houston and Dallas, where things aren't even on the market for a week, and they have like 10 11:57.640 --> 12:05.890 offers and investors from up here from New York, they're coming in cash, buying things, cash, and, you know, people are being quick. And it's a 12:05.890 --> 12:15.670 definitely an interesting way to make money. If you know, you don't really want to play a long term game of like, you know, sitting on your 12:15.670 --> 12:24.760 money for 10 years, 12 years, like, it's a very interesting way to make money. Because you can either win. And when you went in real estate, you 12:24.760 --> 12:34.330 know, it's a good return on investment. Or if you do it incorrectly, you can put yourself in the hole, really bad. But it's also one of those 12:34.330 --> 12:42.490 things where, now specifically, there's so much competition where you have to, you know, be competitive and have the money, cash, you know, 12:42.490 --> 12:49.960 sometimes depending on the market, or be creative and make sure that you out win the other people that are competing with the market, like I 12:49.960 --> 12:59.710 said, you know, in from 2019 to 2020. You know, we saw like a net profit that people are getting anywhere from 60 to $65,000. And it's only going 12:59.710 --> 13:03.580 up from now. It's definitely going to be interesting to see what ends up happening. 13:03.610 --> 13:12.970 Sean Murray: Yeah. You mentioned people who are from, like New York, and going and buying properties in other parts of the country. Right? And 13:12.970 --> 13:21.370 trying to flip them. But and so that's kind of what I thought was probably happening. But I have talked to some people around here that 13:21.370 --> 13:25.600 said that they're doing in the New York metro area. That their opportunities do around here, too. 23:00.000 --> 13:33.029 Johny Fernandez: They are. And it's interesting, because now what the market is doing is, you know, places that are that were like, a million 13:33.029 --> 13:42.569 dollars 1.2, 900,000, 800,000, they've been on the market for so long, because of obviously, New York was hit differently with Corona. That, 13:42.659 --> 13:48.989 you know, buyers and sellers, they're willing to compromise and meet halfway because a lot of people want to get out of New York, because, 13:49.349 --> 13:58.469 you know, for $800,000 you know, you get a studio apartment here you go down south, you can get like three mansions in like Texas, which is 13:58.469 --> 14:07.649 crazy. But it's also interesting to see how exactly, this will end up, changing the market forever, because there's so much inventory and 14:07.649 --> 14:13.739 people want to get out of the city. But then it's also an opportunity where people either want to stay in the city and invest because now's 14:13.739 --> 14:20.639 the time to do it, because you have the opportunity to do it. And mortgage rates are, you know, at a pretty much an all time low, or also 14:20.759 --> 14:27.059 just the simple fact that people can afford it. And people are coming from places like Texas and California and they're like, Oh, we can 14:27.059 --> 14:34.319 actually afford New York now. It's not the same New York as it was two three years ago, but it's a New York that's going to change. And there 14:34.319 --> 14:41.369 s opportunity to jump on it. And it also brings in young entrepreneurs that they can afford things like you know, a studio apart 14:41.369 --> 14:48.659 ent on the Upper West Side. They can pay for in cash, the maintenance fe s, you know, they're still there, but it's something they could afford 14:48.659 --> 14:51.419 now. It's interesting to see. 14:51.960 --> 14:59.340 Sean Murray: Yeah, we actually have a story on our site. Came out a few months ago. It's about real estate being a pretty common side hustle. 14:59.760 --> 15:10.050 That folks in the business finance industry had really delved into during the pandemic, but also was happening quite a bit behind the 15:10.050 --> 15:19.920 scenes where this industry, you know, alt finance with their day job, but that they're also pretty heavy into investing in real estate. You 15:19.920 --> 15:26.100 know, when they when they leave the office? To the point where I've heard that for some, they could do that full time if they want it. You 15:26.100 --> 15:26.640 know what I mean? 15:27.110 --> 15:37.340 Johny Fernandez: Yeah. And just the money that you get in return from an investment. If done correctly, could be an entire salary of someone 15:37.340 --> 15:46.010 that's working a regular day job. So it's interesting, because it could eventually turn into someone's full time job, if done correctly, again. 15:46.730 --> 15:54.290 Because, you know, there's this wealth. And I think someone once said that 80% of the wealth in New York City is because of real estate. 15:54.890 --> 15:55.580 Sean Murray: I can believe that. 15:55.580 --> 16:04.180 Johny Fernandez: Yeah. So it's definitely interesting to see how, you know, the city will come back, but also how people are using their money 16:04.180 --> 16:12.700 in the time, you know, that are flipping, whether it's down here or down there and how that's going to impact just the economy overall. So 16:13.140 --> 16:14.910 Sean Murray: All right, fix it and flip it. 16:14.910 --> 16:20.360 Johny Fernandez: Fix it & flip it. And now's a good time to do it. I mean, especially if you live in New York, and you want to go to like, 16:20.360 --> 16:29.840 Connecticut, New Jersey, prices are there. I mean, it's like you can buy things now. And that back, you know, two, three years ago, was extremely 16:29.840 --> 16:37.370 overpriced. And I have stories regarding like, working with clients that, you know, are now in the hole, because they're like, I bought it 16:37.370 --> 16:46.010 for X amount, and now it's gone on the market for X amount, and they just want to get rid of the place, you know, they may lose, but 16:46.040 --> 16:48.380 whoever's buying is gonna win. So... 16:49.970 --> 16:51.950 Sean Murray: I like it. Maybe I'll be the buyer. 16:52.040 --> 16:54.200 Johny Fernandez: Hey, I have a couple places. 16:54.800 --> 16:55.640 Sean Murray: All right. I'll check them out. 16:57.260 --> 17:04.550 Johny Fernandez: And the next topic we're going to talk about, and I know it's going to make a huge impact here. Is this new restaurant 17:04.550 --> 17:18.500 grant, you know, that is pretty much equivalent to a PPP loan. And it's also going to put an interesting spin for lenders, too. So you want to 17:18.500 --> 17:19.520 talk a little bit about that? 17:19.580 --> 17:29.180 Sean Murray: Yeah. So it's, it's the American Rescue Plan is essentially it's almost like a PPP, but targeted at the food service industry. They 17:29.180 --> 17:30.650 were just completely decimated. 17:30.680 --> 17:32.570 Johny Fernandez: Yeah, they were. Especially here in New York. 17:32.570 --> 17:40.403 Sean Murray: Decimated. And there have been other targeted pieces of legislation. Like there was one targeting like, like venues, and so 17:40.467 --> 17:49.277 forth. We did a story about the Austin, Texas. music scene. And how is almost entirely destroyed by COVID. Because there's businesses that 17:49.341 --> 17:58.024 those venues were essentially breaking even before it was a labor of love. You know what I mean, being in the music scene down there, at 17:58.088 --> 18:07.218 least that's how it was, you know, it was framed. And, but this plan is aimed at restaurants. And if you're someone who's, you know, who had to 18:07.218 --> 18:15.902 compete against PPP, or EIDL, because you're a broker, or you're a lender or funder, here's yet another new program to compete against. 18:15.902 --> 18:24.904 That is the same thing, right? A long time ago, a long time ago, being like 18 months ago, if someone told you they were going to get a free 18:24.904 --> 18:34.226 government grant, he would have said you're being scammed. So it's not a real thing. But now it's real. And this one is targeting. It's targeting 18:34.226 --> 18:41.760 restaurants of all size, but they have allocated a certain amount of funds for different for different sized businesses. 18:48.600 --> 18:48.950 Johny Fernandez: And I have it right here. So the SBA will be 500 million just for merchants with less than 50,000 gross receipts in 2019, 18:49.280 --> 18:57.350 4 billion will be set aside for the 50,000 to 500,000. bracket and 4 billion towards the 500,000 to a million bracket. 18:57.410 --> 19:01.880 Sean Murray: Yeah, so that first category, I mean, that's really small. 50,000 in gross receipts, I 19:04.370 --> 19:05.270 Unknown: [cross-talk] 19:05.960 --> 19:13.340 Sean Murray: So that's really, really small. Yeah. And that's probably the area that PPP really struggled to reach. You know what I mean? And I 19:13.340 --> 19:24.110 think that's probably why they're making an effort to target that group. But speaking of restaurants, anecdotally, and we've spoken about it on 19:24.110 --> 19:31.940 here, you know, what's happening, in real life, I was just walking through my old neighborhood in Manhattan, just last week, and I was 19:31.940 --> 19:46.430 really bummed to find that most of my favorite spots were gone. And the ones that survived were chains, and I haven't read too much data about 19:46.490 --> 19:57.230 the differences, right. But Starbucks was still there. The supermarket was still there, the movie theater was still there. The chain 19:57.230 --> 20:08.780 restaurants was still there, but the local pizza joint was gone, right? The local taco joint was gone. And it was just kind of sad. Because 20:09.110 --> 20:11.420 those are place-- even though I don't live there anymore. 20:11.510 --> 20:20.090 Johny Fernandez: It was those are places that are, are like home to you because, I think so instead of best is Manhattan is a bunch of small 20:20.120 --> 20:29.840 communities in this massive Island. And essentially you find your local coffee shop, you find your a local pizza shop. Like after you go out on 20:29.840 --> 20:37.250 a weekend you find the guy that's like, hey, like, set your dollar slice. How's it going? And, you know, he's there and for them to close 20:37.250 --> 20:43.640 down that kind of, and, and I was talking to someone about this, that changes New York, essentially, because New York is always like a it's 20:43.640 --> 20:54.170 the best, you know, local mom and pop shop. And now it's the only things that are surviving our franchise. And, you know, essentially, like, 20:54.710 --> 20:59.120 that's everywhere in America has a a Starbucks, Chick-fil-A, McDonald's or... 20:59.120 --> 21:06.200 Sean Murray: Chick-fil-A was still there. And, I noticed. And I hadn't thought about it. But the only businesses of which I did make friends 21:06.230 --> 21:12.860 with like, the owners or whatever, were the ones that were independently owned. They weren't, they weren't chains. And it's like you said, New 21:12.860 --> 21:20.720 York is like a series of community, you know, series of communities. And it was very much like that for me. Where I always knew, even if it 21:20.720 --> 21:29.630 wasn't the owner, it all the people who... [cross-talk]. And I totally had anticipated going to all these different places and telling them 21:29.630 --> 21:37.340 hey, I'm back. I'm back. You know catching up. And they were just, like, completely gone. Like, stripped down to the studs, you know, there was 21:37.340 --> 21:47.330 just nothing in there. And as sign said, For Lease, and it was just, it was heartbreaking. Because, if you ever want to bring people back to 21:47.330 --> 21:55.760 your old neighborhood is what it was all about is it's just not it's not there anymore. And it's too bad. Because, you know, I don't know if they 21:55.760 --> 22:04.820 got like, PPP or the EIDL, and all that stuff. This restaurant grant program. It's great, but I wonder if it came, if it's coming too late. 22:04.990 --> 22:11.350 Johny Fernandez: Yeah, and so that's, that's definitely something valid, because I think like you said, you go into different neighborhoods, 22:11.350 --> 22:20.170 whether it's in Manhattan, Brooklyn, Staten Island, or Queens, because we did things differently here. And there's so many for lease signs, you 22:20.170 --> 22:28.240 know, or restaurant closed until further notice. But you know, by now it's like, are these guys probably are not gonna open back up. Because 22:28.240 --> 22:35.890 it's been closed for like more than a year. And it's gonna be interesting, because whether it's this grant program, or PPP, these 22:35.920 --> 22:43.690 local restaurant owners, and these local business owners are fighting day in and day out to survive. And if this is too late, you know, 22:43.690 --> 22:50.770 they're like, all these guys are, you know, paying crazy amounts in rent. And they can't afford that, they can't afford employees, they've 22:50.770 --> 22:57.430 had to let go their employees, you know, their bare bones staff right now. And it's like, they're just trying to survive. And these grants are 22:57.430 --> 23:03.790 coming out, that's great. But it's like, well, these guys even get it at this point. Because they're like, in just that one block, like you said, 23:03.790 --> 23:11.350 in certain neighborhoods in Manhattan, they're one out of like, 10, local mom and pop shops that are there. And they're competing with all 23:11.350 --> 23:15.940 of them. They compete with the entire city, they can be with the entire country. at this point just to survive. 23:16.270 --> 23:23.530 Sean Murray: You know, speaking of behind, you know, the cost of rent and all that stuff. This is an old, an old number 15 years ago, but 23:23.530 --> 23:33.130 there was a restaurant that I had reviewed with an underwriter. And that was on Park Avenue South. Like, you know, Midtown. And we were looking 23:33.130 --> 23:38.050 at the numbers this, you know, this business is doing like 100k a month in revenue, right? Like, nice, right? 23:38.050 --> 23:38.680 Johny Fernandez: but their rent is probably-- 23:39.970 --> 23:49.420 Sean Murray: 80 grand. They're paying 80 grand a month in rent. This is 15 years ago. So when we talk about behind on rent, I just don't know if 23:49.600 --> 23:58.420 people understand the phenomenal cost. The rent is, at least in New York. Like eight-- You know, if you're a year behind on rent, you 23:58.420 --> 24:07.270 multiply that by 80. You know, we're talking about a million bucks behind on rent. I don't know that one digs out of that hole. Yeah, you 24:07.270 --> 24:10.900 know, gets the grant. You know, whatever it is. It's a great solve the problem. 24:10.900 --> 24:16.390 Johny Fernandez: Yeah, the grant isn't gonna solve the issue. And I've thought about this, and I've talked about a lot with with different 24:16.390 --> 24:24.430 people. Just the simple fact that sometimes when you're like, let's say, a landlord's behind on rent, let's say you have 10 units, and, you know, 24:24.430 --> 24:33.010 they have one person living there and each, like they're paying for that person's mortgage or building mortgage. And they're so behind on rent 24:33.010 --> 24:42.520 some buildings, you know, they're like, desperate for vacancy, like for people to vacate the place. That it's like, will they ever retire? 24:42.520 --> 24:47.110 Because they have like things like the moratorium in place that just keeps being prolonged, prolonged, but it's like, 24:47.110 --> 24:48.200 Sean Murray: That's for just for eviction. 24:50.090 --> 24:55.010 Johny Fernandez: But there are persons living for free, they're not paying anything. They can't do anything about it. They can't solve the 24:55.010 --> 25:02.780 issue. So it's like every it's a lose lose for everyone essentially. But you Like, you're right, like, you know, a grant or PPP, that's not going 25:02.780 --> 25:04.580 to cover [cross-talk] 25:07.820 --> 25:13.670 Sean Murray: Does that even solve the problem? That's his rent? Surely there are other, you know, unresolved issue that feel like a million 25:13.670 --> 25:20.780 dollars in background. You know, that's something to keep in mind, if you're an underwriter out there reviewing these typically looking at a 25:20.780 --> 25:27.560 business in New York City area, really consider the rent, the rent factor, and if they're behind, in your mind, you might be like, ehh, 25:27.560 --> 25:33.020 It's 2, 3, 4 months or whatever, but they'll be talking about hundreds of thousands of dollars. In back rent. 25:33.750 --> 25:43.290 Johny Fernandez: It's gonna, it's, it's gonna be interesting to see how things start turning out now that the city's kind of opening back up and 25:43.290 --> 25:50.700 things are going back to normal to see what's going to happen to these restaurants, how they're going to get themselves out of the hole 25:50.730 --> 26:00.150 essentially said, yeah, that's the big thing that I'm curious to really see how the city comes back from this and of New York will ever be the 26:00.150 --> 26:07.290 same in regards to not losing its New York City authenticity with those cool restaurants that are just like mom and pop that been there for 26:07.290 --> 26:13.200 years. versus having like checkers and McDonald's, KFC... 26:13.200 --> 26:16.350 Sean Murray: Yeah, I mean, I didn't live in my old neighborhood. You know, Chick-fil-A and Starbucks. 26:21.810 --> 26:25.050 Speakers: [cross-talk] 26:25.050 --> 26:29.220 Sean Murray: Would come from out of town. I wouldn't take them to know right, I would take them to my spot. 26:29.310 --> 26:30.000 Johny Fernandez: What's your spot? 26:31.350 --> 26:32.340 Sean Murray: Well it's not there anymore. 26:32.370 --> 26:33.810 Johny Fernandez: But what was your spot? 26:33.990 --> 26:36.210 Sean Murray: It was a nice little Italian spot. 26:36.390 --> 26:46.080 Johny Fernandez: Okay. The Smith? You know about The Smith? No, it's it's a chain restaurant. Okay. Oh, is that some sort of? It's an it's a 26:46.080 --> 26:49.410 good place. 26:49.510 --> 26:58.300 Sean Murray: Dominos? My favorite Italian. There's actually a scene in the office where Michael goes to New York. And he goes to his favorite 26:58.300 --> 26:59.770 pizza joint is Sbarros. 27:07.730 --> 27:08.810 Speakers: [cross-talk] 27:13.550 --> 27:16.760 Johny Fernandez: Before we leave favorite pizza joint in New York City. 27:18.350 --> 27:28.520 Sean Murray: It's called Rosa's Pizza. It's it's in Midtown. It's on where they're like, upper 20s and Seventh Avenue. And I like it a lot. 27:28.550 --> 27:34.820 It also has... had, by the way. I haven't been there a while so I don't know if it's still there. But there was one there. It also had, It's not 27:34.820 --> 27:41.510 a chain, but it had multiple locations. There's one there. There's one there was one in Penn Station. Then there was one out there on Long 27:41.510 --> 27:45.980 Island. All owned, you know, by the same people. There's hands down from me with the best. 27:46.130 --> 27:49.370 Johny Fernandez: Really? That's okay. Nice. 27:49.670 --> 27:52.970 Sean Murray: I also want to give a shout out to Rocky's Pizza on Second Avenue. 27:53.060 --> 27:54.020 Johny Fernandez: Okay yeah. 27:54.020 --> 27:55.610 Sean Murray: If you're out there watching at Rocky's 27:55.670 --> 27:57.410 Johny Fernandez: Nice. I'll tell you mine. 27:57.560 --> 27:58.370 Sean Murray: Okay, what's yours? 27:58.690 --> 28:08.350 Johny Fernandez: Scarr's on Canal Street. Authentic like small. Like everything like we walked as like a time machine and the lines it's 28:08.350 --> 28:15.820 still out the door till this day they're still open. It's wild. But it's the best-- I would like 30 minutes for a slice, just one slice. And then 28:15.820 --> 28:21.490 Prince Street Pizza on Prince Street in Soho. Love that place! Square pizza extra pepperoni. 28:22.780 --> 28:24.430 Sean Murray: I know we're having fun today. 28:27.370 --> 28:33.880 Johny Fernandez: All right, so definitely check those places out and also check out our website deBanked.com for more information on this 28:33.880 --> 28:42.220 episode previous episodes and also articles regarding the industry and like the latest news so definitely always awesome to see those things 28:42.220 --> 28:44.590 and check us out on social media and 28:45.370 --> 28:52.630 Sean Murray: Subscribe. deBanked.com/subscribe should take you to the subscribe page, you'll get our email newsletters, and promotions 28:52.630 --> 28:59.170 regarding you know industry news and deals that come out if you don't want to miss it. So make sure you subscribe. 28:59.290 --> 29:04.000 Johny Fernandez: And also before we leave Don't forget this summer what's going on to summer big event. 29:04.000 --> 29:06.640 Sean Murray: Broker Fair and it's in New York, by the way 29:06.670 --> 29:13.510 Johny Fernandez: We can take you to Well, I don't know we're gonna take you but definitely check out those places with pizza spies. While you 29:13.510 --> 29:14.230 enjoy Broker Fair. 29:14.260 --> 29:23.050 Sean Murray: we should do a raffle where Johnny [cross-talk] That would be good. 29:23.230 --> 29:28.480 Johny Fernandez: So Broker Fair, definitely if you're interested. That information we found online you can sign up, it's going to happen in 29:28.480 --> 29:28.930 December. 29:28.930 --> 29:31.600 Sean Murray: December 6th in New York. Brokerfair.org 29:32.050 --> 29:37.270 Johny Fernandez: Yeah. And then I think that's all that's all for today, guys. We'll see you guys next time. I'm Johny Fernandez. 29:37.330 --> 29:38.080 Sean Murray: I'm Sean Murray. 29:38.080 --> 29:38.920 Johny Fernandez: See you guys later.