Episode 623 – Louise Phillips Forbes

Gabriel Petersen (00:02.341)
All right, we are back with another episode of the real estate investing club. Hope you guys are having a great week great day wherever you are and whatever whatever wherever you are whenever you however I say that. I hope you guys are having a good time. It’s a good day for a second reason because we got Louise Phillips Forbes with us on the show today. She has done over 6 billion in sales to the big B over there in New York City.

She is with Brown Harris and Steven. So there’s a lot of experience to go into on the buying side. She likes to go into the multifamily. She started in single family dabbled in mobile home parks and now she’s in the multifamily. So a lot of, a lot of stuff to go into here. A lot of experience, I think spanning over 20 plus years in the industry. So it should be, should be good. Louise, thanks a lot for hopping on the show.

Louise Phillips Forbes (00:47.458)
Glad to be here. Thanks for having me.

Gabriel Petersen (00:49.541)
Absolutely. I told you before we got on here, we always like starting with stories. We like to hear how people got to where they are. So why don’t you take us to the beginning of your story? I think I said 20 years, but I think it’s even longer than that. Take us back. Yeah. Take us back to the beginning and there you go. Yeah.

Louise Phillips Forbes (00:54.606)
Yay.

Louise Phillips Forbes (01:01.134)
It’s 35. I’m only 39, so it’s all good. So, you know, I was born and raised in Nashville, Tennessee. I ended up in New York coming here to be a dancer. I used to say 10 pounds ago, it might be a few more pounds than that. But I injured my back. I did some off-Broadway stuff. I danced for two small dance companies. And I was bartending when I injured myself. And somebody said, man, you’d be so good in real estate.

And she was like, call my friend. I called her friend and I met him. He’s like, you want a job? I called my brother. And he’s like, I was like, I got a job in real estate. And he’s like, you know, that’s commission only. I was like, oh, no, I didn’t. So fast forward, I made $8,400 my first year in real estate. So keep coming back. I just love it. I mean, I used to think real estate was about brick and mortar, but it’s really a business of people. So that’s really what makes me tick.

Gabriel Petersen (01:58.437)
Nice, I like it. So you started out, you’re a dancer, you got hurt and then just kind of fell into real estate. We hear that story, not that same story, not everybody was a dancer, but that type of story so often on the show where people just kind of stumble into real estate and realize it’s the coolest thing in town and you gotta just kind of keep going with it. so once you started, it sounds like you were just starting on the residential side. Since then you’ve done $6 billion in sales, which is a lot.

Louise Phillips Forbes (02:10.082)
Back door.

Louise Phillips Forbes (02:17.73)
I love it.

Gabriel Petersen (02:26.966)
Obviously. And so let’s hear about that progression. How? Yeah, how did how did it progress? Tell me a little bit how the snowball started.

Louise Phillips Forbes (02:28.65)
One deal at a time. One deal at a time.

Louise Phillips Forbes (02:37.632)
Well, you know, I mean, my Rolodex did not consist of very wealthy people. It was starving artists. So my business was literally built one deal at a time. My first transaction was sixty three thousand dollars. And it’s hard to believe that anything in New York City was sixty three thousand dollars. But but but I, know, I think what I found was really important for me was kind of

Gabriel Petersen (02:55.716)
was gonna say, dang, man, I wonder what that’s worth now.

Louise Phillips Forbes (03:06.926)
how I didn’t like thinking of myself as a salesperson for some reason. I really wanted to just be of service, and I wanted to be an educator. And numbers I get, and I also think the piece of real estate, whether you’re just an investor, there’s an emotional piece that goes with all those things, which I’m really great at that matchmaking and putting that piece of the puzzle together. But I also got

sort of referred a piece of business that was a development project in the West Village, which was one of now today I’ve done over 35, where I do the marketing for the developers. And so as a developer’s broker, you kind of accelerate a business when your names are wrapped around a building and you’re doing a 250 or $300 million project, you start to gain.

momentum and a reputation. And so that has been a way that I was fueled into the residential market and also a very diverse market. You learn how to, you know, what the people want, but also the construction part of it, the financing part of it. And those pieces helped hone different skills for me.

Gabriel Petersen (04:17.636)
So you were, you got in contact with developers and then you sold on the backend with these single family or New York City.

Louise Phillips Forbes (04:23.892)
They basically hired my company, myself, me as the individual agent to do the marketing and the onsite sales.

Gabriel Petersen (04:33.186)
Okay. And what type of, of, product was this, was this, condos apartments?

Louise Phillips Forbes (04:37.838)
They were 22 unit condominiums in the West Village or ground up in East Village or conversions of rental buildings to condominiums. I specialized in that. So it was really an amazing opportunity to have a slice of so many different neighborhoods in a very deep dive. And it was really fulfilling.

Gabriel Petersen (05:03.972)
So if my math is right, you said 35 years. I’m almost 40. I was born in 86. So that means you got started in 1990, essentially. Nice. So that was a while ago and a lot has changed since 1990. mean, now we got AI, we got the internet is everywhere. We got social media from the days when you started, you were doing those development cells back in the day to now. How has the process of

Louise Phillips Forbes (05:15.386)
in 1990. I did.

Gabriel Petersen (05:33.836)
acquiring leads and selling properties, how has that changed?

Louise Phillips Forbes (05:39.092)
say my business is still probably 90 % referral, but attraction of business, know, I mean, let’s be clear, we didn’t have these when I was selling real estate. mean, literally had to go to Payphone on the corner. You can’t find a Payphone in New York City. So, it’s been an incredible evolution. you know, listen, I’m trying to keep up with it. Thank goodness my kids are

and 22 and they are very entrepreneurial and sometimes they’re helping me figure out some of this AI stuff. But for me, I welcome the AI. I am not intimidated by it. I welcome it because I think that my clients having access to that data myself as well, it’s the interpretation of that data which is what’s really the texture of the market.

Gabriel Petersen (06:28.45)
But in terms of like acquiring new clients, selling deals, mean, it sounds like for the most part, this is still done face to face in your world.

Louise Phillips Forbes (06:39.214)
But listen, know, the components about real estate never change. know, presentation, pricing. They will come. It’s like they build it and they will come. But if you’re not priced right, your phone is not going to ring. It doesn’t matter where it is.

Gabriel Petersen (06:58.626)
Yeah. I, so I’m obviously I’m on the commercial side. buy mobile home parks, RV parks, self storage facilities. And I’ve found brokers, when it comes to pricing, there is so many different strategies that they, that they use. and I, I feel like a lot of them are not, not good. a lot of feel, a lot of times people will price really low in order to, get a bidding war to start. and then a lot of times people will price.

Louise Phillips Forbes (07:23.66)
Yeah, not my style.

Gabriel Petersen (07:26.04)
really high so that they anchor high and then when you low ball them, you’re still within a range that they want to get. What do you feel like?

Louise Phillips Forbes (07:34.382)
I’m really data driven. take, I mean, first of all, when you live in a vertical city, you know, like I have the same apartment on the 12th floor, on the 10th floor, on the third floor. It’s a little easier, in my opinion, to quantify that than a cul-de-sac lot compared to, you know, a different kind of neighborhood. I just feel it’s a little more scientific when it’s vertical.

Gabriel Petersen (08:04.121)
Hmm. because your comps are literally on top of each other.

Louise Phillips Forbes (08:04.204)
So I feel like I have a little… Yes, yes. So there’s a little more of a science, but in a market like today, there is zero science. We have a very different recovery process from something like COVID. And I personally think New York City is such a discount at the moment.

Gabriel Petersen (08:21.413)
Hmm.

Louise Phillips Forbes (08:30.414)
and such an opportunistic market because we didn’t have the run that RV business did during COVID or the trailer park in Montauk where I live, where I have my beach house, where the best surf break is, you know, that skyrocketed and New York didn’t. It’s been steady eddy. And so I think it’s a really good opportunity.

And I am much more for what is in contract and the relationships that I’ve built over 35 years of calling you and saying, hey, Gabe, what are you in contract for? I know you started at this number, you dropped it three times, you got a contract signed in three days. So did that go for the asking price? That’s the real time market. And that’s how we price.

Gabriel Petersen (09:16.404)
Okay, that makes sense. It’s interesting that you say that you feel like New York is is discounted. I’ve well, at least in terms of the people that I speak with, New York as a state is generally a state that people don’t want to invest in because of the laws, you know, the the the rent laws there. Do you feel like, you know, speaking from investor from the investor perspective, is it is it still

Louise Phillips Forbes (09:33.568)
It is close. Yep.

Gabriel Petersen (09:43.386)
Would you suggest somebody invest in New York City? Obviously, if you can get something at a steal, then you’re going to buy it. But if you’re buying at market, what are the kind of the hurdles that you see people running into when they’re investing for an investment property, not for their single family?

Louise Phillips Forbes (10:00.302)
Well, I think that it depends on like, so the 1031 opportunities that are out there and people coming into this market. I just think that some of the multifamilies because of the laws are super low. just because of the way the policies are. I mean, we’ve had a fair act that it just the way the policies are and the political arena. So I have landlords that own

Gabriel Petersen (10:15.321)
Hmm. because of brain caps.

Louise Phillips Forbes (10:29.878)
six billion dollars worth of real estate, you know, multiple buildings. And as their tenants in the last five years have passed away, they’re not putting their property on the market. They don’t get the benefit of the 80-20 for putting, for every dollar you invest, you get to raise the rent. That’s been paused by our councilmen. So, lot of multi-generational families are leaving and investing. Like I have a

Gabriel Petersen (10:51.395)
Mm.

Louise Phillips Forbes (10:58.996)
a five generation real estate family that has bought 40,000 units across the country in the last two years instead of buying here. And that’s, but I do think that political, you know, atmospheres will prevail and shift because that is, you I think that’s what’s going to be needed. I don’t know if it’s going to happen in the next four years, but we’ll see.

Gabriel Petersen (11:26.307)
Interesting. Yeah. So for your own investing, you and your family, you guys have been getting into multifamily. Tell us how that’s gone. It sounds like you and your daughter and your son are doing it now. What are you guys looking for?

Louise Phillips Forbes (11:38.862)
My two sons. So I’m married to a serial entrepreneur. He’s a tech guy. um, and, know, and we were late bloomers. had my first child at 42 and my second at 44. And, um, you know, they, they inherited a little tiny money, a bit of money from my husband’s father when he passed away. And I said, you guys want to buy a car, you know? And they were like, I’m not spending money on a car. We’re just going to use yours. I’m buying Apple and Tesla.

Gabriel Petersen (12:07.877)
Ha ha ha.

Louise Phillips Forbes (12:08.782)
And they bought all the stock to their credit. And it started a conversation between the two of them, like, I want to own real estate. Why don’t we figure out? And so they, older son, started a premise of really researching Detroit, Michigan, Nashville, Harlem, Connecticut. And what he came, he had this sort of, it honed what the thesis was, which what he wanted.

universities, medical, you know, hospitals, and a high growth coupled with a high rental percentage. So they landed in New Haven, Connecticut. They purchased a three

Gabriel Petersen (12:53.125)
Really, with those criteria, he landed in New Haven, Connecticut.

Louise Phillips Forbes (12:55.79)
Hold on. Yale, Yale Hospital, Hartford Medical Center. Plus, it’s a 74.6 % renters community with 3 % growth year over year.

Gabriel Petersen (13:09.861)
interesting. Huh. Okay, that makes sense.

Louise Phillips Forbes (13:14.926)
So they identified this piece of property, cash on cash, and I’m such a bad partner, I can’t even tell you the stats because they are so in charge and large. They have three Section 8 tenants, guaranteed fair market, and they will probably have a $20,000 profit for the year. They bought this in April.

Gabriel Petersen (13:40.182)
wow, good for them. And so this, how many units is it?

Louise Phillips Forbes (13:43.244)
It’s only three units, but my son has figured out how to get a fourth unit, which hasn’t even been calculated. He’s just getting bids on it. But it’s so fun to, one, let them run with it, and two, watch how much they learn. people are saying, well, they’re following your footsteps. I was like, this is not my footstep.

I didn’t have the courage at 20 something to even think like this. So it really is great. So I think both my husband and I are really excited about trying to build a portfolio with them. And I just love the mindset.

Gabriel Petersen (14:28.409)
Yeah, that’s, building something with your kids. have a three year old daughter, well, almost three year old daughter, and I hope, and a son on the way. and so we’re excited and, and, know, 10 years down the line, 20 years down the line, I hope that we can be, doing the same kind of thing. I’m really excited for it. I hope it’s something that they want to do. obviously, you know, that’s something that you kind of have to model for them and, and instill your excitement in them. So I’m hoping that kind of wears off and when she’s a 20, 22, 23.

Louise Phillips Forbes (14:34.456)
God bless.

Gabriel Petersen (14:56.621)
She’s got to get the bug, real estate bug and joins me. So, but we’ll see the verdicts.

Louise Phillips Forbes (15:00.812)
They go around, don’t let her see too much of the, you know, the bad stuff because my kids have learned firsthand what happens when a sewage trap backs up. It’s not attractive. And they were like, but it’s part of it.

Gabriel Petersen (15:15.653)
That’s part of it though. Yeah, awesome. Well, hey, we are running down the clock. But before we move on, I always like to ask in the next one to two years, what is your crystal ball say? What are you guys trying to do in your in your field?

Louise Phillips Forbes (15:31.394)
Well, the reason why I sent the I told you before we started the next two to three years, I think our family personally, we really want to build a portfolio. And my son has just written a presentation and gone out to friends and family and to raise a fund while he is was just interviewing at Stern, NYU’s business school.

for real estate program. I think that we wanna support that opportunity. And for myself, I’m gonna keep doing what I do and hopefully my husband’s gonna sell his company and then we’re gonna really be focused on the other businesses with real estate and expanding that.

Gabriel Petersen (16:18.511)
Nice, I love it. Well, I wish you guys the most success you can get in that endeavor. I love to see families getting at it together. And so yeah, it sounds like a lot of fun. With that, I am gonna push us on to the quick question round. Are you ready? Let’s do it. Starts with education. It could be any form. It could be a book you’ve read, a conference you’ve gone to, a mentorship program you’re part of. I just need two recommendations, one for general life wisdom and then one for real estate.

Louise Phillips Forbes (16:32.12)
Go for it.

Louise Phillips Forbes (16:47.15)
Quantum Real Estate Agent from David, who did I just read? David Harper, I think. I thought that was actually had some great insight. Life, I’m actually reading A Purposeful Life by C.S. Lewis. It’s a tough read, but it’s an interesting read.

Gabriel Petersen (17:17.157)
Cool, yeah, my mom loves C.S. Lewis. What’s that one book she likes? Screwtape Letters, I think that’s what it’s called. Yeah, yeah, good author. All right, moving us on to the next question. This is for your younger self. Let’s go back to the version of you that was just starting out 35 years ago, back in 1990. Go back to her, look her in the eye, give her one piece of advice moving forward.

Louise Phillips Forbes (17:24.046)
Yep.

Louise Phillips Forbes (17:42.67)
Buyers and sellers will come and go, but your people in your industry will be people who will be with you for your life. And that is that generosity of knowledge, where you attract those kinds of individuals, where you can pick up the phone and say, Gabe, what are you in contract for? That has been the best lesson I learned as my earlier self and that I would advise myself to focus on.

Gabriel Petersen (18:10.403)
Nice. like that. So be transparent with people, develop relationships over time in your industry because those are the ones that you’re going to be growing with. It makes a lot of sense.

Louise Phillips Forbes (18:19.394)
And that collaboration is so much better than the competition, because I don’t look at my agents or my colleagues as competition. I look at them as an opportunity for collaboration.

Gabriel Petersen (18:31.149)
Yeah, yeah, anybody that you interact with throughout any deal that you do, you got to remember, even if you’re on the opposite sides of the table, you got to remember that, you know, they might sell you a deal in the future, you might buy or they you might buy a deal from them, you never know. So just keep things open, keep things, just see everyone as a friend. And eventually, that’ll that’ll pay out to you in spades. And next question, I’m actually going to skip this. Usually I ask

Louise Phillips Forbes (18:45.25)
Amen.

Gabriel Petersen (18:58.597)
The United States is a big place and there’s a lot of opportunities. So what’s your favorite Metro to invest in? But you just, well, actually I’m going to continue to ask that because you did say New Haven earlier, which is not New York City. I thought you were going to say New York City, but so tell me the United States, big place, lot of opportunity. Give me the single Metro you’re most excited about investing in today.

Louise Phillips Forbes (19:22.264)
Well, I have two that I would like to invest in. One, I would like to continue to invest in New Haven because that’s a focus that my sons are interested in. I see the opportunity and the formula and the thesis for it. Secondly, I would like to invest more in Montauk. I’m a surfer. Our whole family’s are surfers. And we’re water people.

I would like more of that.

Gabriel Petersen (19:54.64)
Nice. Yeah, I have, my wife and I, one of our favorite cities that we like to go visit is, Charleston. And I’ve, I’ve been, I keep looking for stuff out there like storage facilities or anything that I can buy as an investment just so we can continue to go out there. haven’t found anything yet, but I like the idea of, investing in places that you want to visit just because it makes the investment a lot more fun. so we’ll see if that comes to fruition at some point.

Louise Phillips Forbes (20:03.049)
yeah, yeah, yeah, yeah.

Louise Phillips Forbes (20:17.262)
Thank you.

Absolutely not.

Louise Phillips Forbes (20:23.97)
I love that.

Gabriel Petersen (20:25.285)
All right, next question is about lessons learned. Not every deal we get into goes the way we expect it. In fact, pretty much every time something’s gonna go wrong, and that’s when we get to learn a lesson. So what is a deal that went a little bit sideways for you? And then what was the lesson you pulled from it?

Louise Phillips Forbes (20:43.406)
Perseverance. Let’s see. I would say that let me just think through. There’s so many deals. mean, I have I lost a deal earlier a couple of months ago on a development project on my it was the Crown Jewel. It’s a fifteen point nine million dollar deal that was a white box. And

The purchaser had a fully negotiated contract and we were building it out for her and then they had some health issues. And we spent four months negotiating that. So as disappointed as I was, what I learned is what we would and wouldn’t do. And so the knowledge that I gained on that as I’m approaching the next right purchaser, I wouldn’t have known. So I feel that wisdom has armed me to lock and load.

Gabriel Petersen (21:35.556)
Yeah. Yeah. And I, another lesson I feel like from that is, you just never know what’s going to happen during, during your due diligence period during a deal. And, I mean, you mentioned, you know, somebody got sick. I’ve had a deal. One of the deals that I would just was so excited about closing and, the, think it was the wife or the somebody in his family died. And so the seller was like, you know what? I’m going to keep it. We’re just, it’s too much right now. obviously we’re going to follow up and we don’t want to be a nuisance at.

a time of a difficult process. the point is when you’re going through your due diligence, when you have a deal on a contract and you feel like it’s going somewhere, don’t count your chickens until the money hits the bank or until you have that title on hand because anything can happen.

Louise Phillips Forbes (22:23.614)
And I would also just to add to that the value. So I took it upon myself to write a really nice note to this woman, was not my client, and sent her some flowers. And I got a phone call from the broker saying that, because I wrote the broker also a similar note, just how amazing it was. I had never worked with her before, and I’ve been in the business for a long time. But the knowledge of and that,

opportunity of connecting with those people and the grace of being okay that the deal didn’t happen and being more focused on hoping her to be to be better was how I wanted to leave that. Right? And that was really about my side of the street.

Gabriel Petersen (23:10.169)
Yeah. Yeah. And those little acts of kindness and thoughtfulness will, I mean, it’ll keep you in their mind going forward. My wife is so much better at that as sending little notes, sending little presence. And I feel like it’s a good touch both on the human side and on the business side. It’s something I need to get a little bit better at, but definitely, definitely a good practice to. Yeah. There you go.

Louise Phillips Forbes (23:30.946)
She’ll rubbing off on you. She’ll keep rubbing. You got a house on girls right now, so you can’t escape it.

Gabriel Petersen (23:37.293)
Yeah, and I got no problem with that. All right, that leads us to the very last question. This is for the listeners you’ve given us a lot to think about. I’m sure people want to reach out, get in contact with you. This is a two-parter. Where can they find you and then what can they expect when they reach out?

Louise Phillips Forbes (23:52.418)
Louise Phillips-Forbes, I’m L. Phillips at B-H-S-U-S-A dot com or Instagram is Weezy, W-E-Z-E underscore says S-E-Z. And I will be present and collaborate and connect and share whatever I can and I’ll look forward to learn a little bit about you.

Gabriel Petersen (24:17.945)
Perfect. I will put that link in the show notes. So if y’all want to reach out, all you got to do is click the little more in the description. It’ll pull down that full description and then there you can find Luis’s info. All right. That wraps up. The baby is due surprisingly the day before our first daughter was born. May 25th is when the baby is due. And so if they’re born on the same day, it’s going to be crazy. I don’t know. I don’t know how we’re going to do that one.

Louise Phillips Forbes (24:28.992)
I love it. the baby do? When’s the baby do?

Louise Phillips Forbes (24:46.222)
You got it. You got this. Good luck. God bless.

Gabriel Petersen (24:47.781)
All right. Yep. For everybody who’s with us today, thank you guys for showing up. You are the reason we do this. So if you guys have any questions, reach out to me, Gabe with the real estate investing club.com. If you guys want to support the show, just leave us a review, a comment, anything like that. Other than that, I hope you guys have a great week. Keep rocking real estate and I look forward to seeing you on the next episode.

Louise Phillips Forbes (25:11.256)
Thanks, Gabe.