Origination
Join us as we delve into the world of multifamily and commercial real estate, engaging in insightful interviews with industry-leading loan originators and salespeople. Discover the secrets that set apart these top performers from the competition as we uncover the strategies and skills that drive their success.
Origination
Episode 24: JD Stettin, Founder of Carnegie Capital - Always Be Curious, How Important are Site Inspections in the Sales Process, Advantages and Disadvantages of Direct Lending VS. Brokerage, and More!
JD Stettin is one of the most solution-oriented and innovative people in the industry. He and Mordecai explore his path from selling Citrons as a boy to selling cleaning solutions, joining Greystone, and then branching out to form his own company, and the creative outlook required to found something that bridges the gap between lenders and the rest of the services a client might need.
2:02 - 12:17 Selling for Sukkot
12:17 - 21:44 A Foray in the Cleaning Industry
21:44 - 35:25 Sales, Management, and Sales Coaching
35:25 - 40:03 Site Visits
40:03 - 57:50 Founding Carnegie Capital
57:50 - 1:03:43 Current Trends
lenders, market, people, loan, client, equity, selling, deals, screen protectors, year, calls, rates, business, borrower, easy, long, sales, chase, interest rates, debt
Hey, this is Mordecai. And welcome back to the Origination podcast where we interview the top originators and salespeople in the multifamily and commercial real estate industries to try to understand what separates the top performers from the rest of the pack. On this episode, I'll be speaking with JD Stettin, founder of Carnegie Capital. JD actually worked for me at Greystone for a number of years. Before he went off on his own to start Carnegie capital, he identified a void in the industry, and saw that sometimes there are limitations in being stuck with just a few products to provide. Going off on his own and starting to broker debt, he was able to offer the universe of solutions to his clients. JD is one of the most creative people I know in the industry. He really he can see a problem and look at it from so many different angles. He marches to the beat of his own drum. In fact, for the first year of Carnegie capital, JD was driving around the country trying out different cities until he finally settled in Austin, where he now resides. I really enjoyed this conversation with JD. I'm incredibly proud of the business that he's built, having closed now over $10 billion of transactions since its founding. Without further ado, let's talk to JD. JD Stettin, welcome to the origination podcast. It's a delight to have you here.
JD Stettin:Thanks, Mordy. Good to be here. Good to see you.
Mordecai Rosenberg:Yeah. We've had a long history together. Yeah, we did a lot of work together at Greystone, a lot of adventures in Chicago back in the day. Yeah. So I'm going to start with the question that I always pose to guests, which is, you have to turn back the clock and go back to the earliest sales experience that you can recall. Maybe that's when you were a kid or high school college. What comes to mind?
JD Stettin:It's a fun question. It feels like the business or sales equivalent almost, of of Krista Tippett's on Being where she always asks about the participants early religious or spiritual experiences. So I think that's a lot of fun. I had a lot of different jobs, growing up. Tutoring, worked for a landscaper, babysitting, all sorts of things. But I think sales wise, my first official formal sales gig was probably at 13 or 14 and selling Glovem and Estrogem on Main Street leading up to the Sukkot holiday. So to help unpack that for those who aren't familiar one of the Jewish holidays in the Fall requires that every adult male purchase a sort of Biblically prescribed group of leaves and fruit. Not unlike a Palm Sunday in fact, one of the leaves is a palm frond. And in the city I grew up in, the neighborhood was heavily Orthodox, heavily Jewish, and for about a week a year on Main Street there were just all these tables set up with a high school age or elementary school boys selling selling these things and that was definitely where I got my my sales start.
Mordecai Rosenberg:Wow, so how did that go? What did that look like? So you had your wares that you're selling right? And you put them on the table and people would would approach you?
JD Stettin:Right and you know, this is a commodity. There were 20 other stands with very similar looking wares, with similar looking young men making very similar pitches, and you know, price points are all more or less the same. I think for me the groove I fell into and the way I found success and joy in it was I really loved the the wares. I loved what we were selling. I was deeply religious at the time and the idea that these fruits and plants were somehow of spiritual cosmic significance was really cool and exciting. And there are all these laws and customs that describe certain shapes and attributes and characteristics of this plant matter that makes them more holy for this purpose. It was really fun to do a deep dive into that and read up and learn and study all these books and get to look at the wares in a completely different way. To look at this citron basically, more or less lemon, but not to see it as just like, oh, it's a lemon, to see the shap, to see the number of grooves, to see how clean it was or it wasn't with the palm fronds to track the spine along the back all the way up. And make sure that the the middle double leaf of the palm fronds was perfectly sealed tip to tip. It was a level of care and attention to detail that I really enjoyed and helping people, because even within the rules and the customs, there's some ambiguity, there's some personal preference, there's some individual custom. And I think it was that marriage of knowledge and an understanding of the wares and the laws behind them. And also meeting people where they were and making them feel comfortable asking questions and honoring their preferences. And you know, when you'd be trying to nudge them in a direction that felt more truthful, or along the lines, of what they wanted. I really loved that. I also loved the autonomy as a 13 year old boy, to be running your own mini business with other 13 year olds was was great. And we worked, 12 to 14 hour days with a quick pizza break in the middle. So there's something about the intensity. I was once in a play in college, it's sort of like that, that work during tech week, the week leading up to the show where it's just all hands on deck all the time following rehearsals. There's something that's great. It was really fun, that energy and and autonomy. It was great. I love people feeling satisfied, like they got their holy work and their good deed done. It was it was really rewarding. At the end of the week when our boss would call us in to pay us, there weren't set salaries or anything, this is all a cash business. None of us have our working papers, 13 year old boys. And he'd call you in and just say so, what do you think you should get? Wow, these are 13 year old. I don't actually remember what it would have worked out to per hour, probably wasn't all that much. But still walking away with, I don't know,$300 or $400 in my hand in 20s, I felt like, like Andrew Carnegie or something. It's really exciting and rewarding and satisfying.
Mordecai Rosenberg:Yeah, that's a lot of money for a 13 year old.
JD Stettin:Big time.
Mordecai Rosenberg:How did that feel, the question of how much do you think you should get? How did you receive that?
JD Stettin:It's interesting. Our boss would pull this similar tactic with the high end Citron's. As you may know, some of them go well up into the end. For people who aren't familiar. I don't know what lemons cost now, maybe a couple of dollars or the pound. But these Citron's with holy purpose can cost anywhere from $35 to like $200. So the nicer ones that had all the proper holy beauty marks, if you will, were kept in the back room. The high end customers were sent to the owner and the boss to deal with, and he would use a similar sales tactic with someone. If they found that Citron that they really liked, he'd say, well, what do you think it's worth, what would you pay for it? Which was really strange initially, hearing that as a kid. Not really understanding. Prices were things, they were facts of the physical world the same way any other physical fact was. This is it's height, this is its weight, this is its price. Realizing at that age, that oh, there's actually a lot of malleability and subjectivity to all of this. So when it came time to getting paid having been exposed to that, on the other end on the sales side, it wasn't a total shock. It was a little strange, but it also felt like a good time. I remember being proud and feeling like I'd done a great job and helped a lot of people, and been really successful, and sold a lot of product. So I felt good. I had tallied up my hours and had a rough sense of how much I'd sold. So, for me, it was actually a really good question. Like, well, I did this, I did that ,you're asking me what I think that's worth. I throw out a number, and I don't recall what my first exact number per hour was, but it felt like a good invitation to kind of take inventory and take responsibility as a young salesman for for myself and my experience. That for me that that really worked well.
Mordecai Rosenberg:Yeah. It's interesting. You're certainly one of the most circumspect people that I know. You're always thinking about what you're doing and rethinking it. You know, and if you think about it, its an interesting question to ask yourself at the end of, of every day. Is, well, how much do you think you should get? What was your contribution today? Which can mean lots of different things. Right? what kind of value did you add to the world? What kind of value did you add to yourself today? It's an interesting question.
JD Stettin:Yeah. And I think hearing you frame it in that way, reminds me that around the same time, my peak in orthodoxy religiosity, I did actually keep a daily written log of my spiritual merits and demerits, we'll call them. Yeah, this sense of, I think, maybe would have been called in my community at the time, a heshbon hanefesh, an accounting of one soul, was for me a literal and daily practice. So the idea of then, accounting for my sales dollars just felt like yeah, of course. I mean, if I'm counting sins, then surely I can count greenbacks.
Mordecai Rosenberg:Yeah, that's really interesting. So let's fast forward a bit, not quite to Greystone, but to before it. So that job, I believe, that you had immediately prior to getting into the industry was cleaning materials. Is that correct? Am I recalling that correctly?
JD Stettin:Yeah, it's actually funny. The friends who had introduced me to Greystone, Nathan Shas. He had been in waste management, and I had been cleaining. And it was sort of accidents of history, the funny places to be in before this. But yeah, EqualLogic Solutions was the company, and we did sell non-toxic and eco-friendly, safe cleaning solutions into the institutional market. So our clients were, at the time, Wholefoods Chipotle, some schools, some hospitals, food production, that sort of thing.
Mordecai Rosenberg:Yeah. How did sales go with that? Can you tell me a sales story there? What did sales look like? Your first successful sales story there, or another good one. I'm curious how you approached that big corporation.
JD Stettin:Yeah, that was that was sort of an interesting role, in that, our clients really ran the gamut from tiny Mom and Pop restaurants in in Brooklyn. We were headquartered in the Navy Yard. The CEO would do the deliveries out of his car once a week to some of these national chains. And as the northeastern Sales Director, Regional Sales Director, whatever it was, they were all ultimately under my purview. So having to switch gears between these small one offs and then making a management level presentation at Whole Foods, corporate offices, and what do they call it, Trillion Dollar Mile in Englewood? What's that place with all those corporate headquarters?
Mordecai Rosenberg:Yeah. Sullivan or 9W?
JD Stettin:Yeah. So it was interesting. So one that comes to mind, and I don't remember which property management company this was, might have been Durst, but maybe not. But whoever it is that cleans the Empire State Building. We had a interview with them, obviously, that's, it's a big job and it is prestigious in its way. And I literally in order to, to try and make the sale, how to clean a urinal in the basement of the Empire State Building with the head of their maintenance facility, there. So it is a very, very hands on job. I lead overnight installations with teams of mostly Spanish speaking workers at Whole Foods, because we couldn't disrupt their daily workflow. So we would show up, I think it was at 10 or 11 and we have to be out by 4am. Also just really hard working, really project based, doing whatever we need for the client. You know, in a way not unlike my first job, it was sort of a mix of mission driven. In the way that the Citron and plant matter felt religious and spiritual, and there was something behind it, so too with this stuff. I remember, dishwasher is at Chipotle, showing me two, three weeks later that they're rashes were gone from switching from these really harsh toxic soaps to these plant based ones. Really tears of gratitude for us in our work. That was really compelling on top of, of course, commission based compensation, and just feeling good at what we were doing. But yeah, it was a small scrappy startup and as a sales guy, you did whatever you needed to do. To keep accounts to win accounts, I was on call practically 24/7. I remember on weekends driving up to Blue Hill stone barns, that beautiful farm to table, farm and restaurant in Westchester somewhere upstate, because the soap dispenser at their dishwasher wasn't working. And I would be there on tech support call with someone with my hand in the machine, trying to rewire something with no training in plumbing or electrical. But we wanted to see this stuff happen and take off and succeed. And it was really, really exciting when it.
Mordecai Rosenberg:So in how did a first call look for that? So you call up Chipotle or Whole Foods or Blue? How did you approach that?
JD Stettin:So we mostly sold through distribution. The way that works in that industry is there are these big distribution houses that supply all the paper goods, Jan San for restaurants, hospitals, hotels. Everything from toilet paper, garbage bags, hand soap. Carry out trays, to go cups, all that stuff goes through these big distributors. We had aligned ourselves with a couple of major distribution houses, who, when they made their weekly daily, whatever sales rounds, their clients would try and pitch them on this green stuff that ultimately saved money and is better for their employee health and environment. So we kind of got brought in, almost warm referrals mostly. The distributor sales guy will say ok, can you call, Mickey over at the DC for Chipotle, they're interested in hearing about this, and they'd set it up. So there wasn't a ton of cold calling. But there was a little bit that I did of my own initiative. I remember when I first started, I literally just went door to door to the restaurants and bars in Williamsburg where I was living at that point with my little sample kit. We just asked to speak to a manager and to make the pitch that hey, not sure if you're aware, but most of the soaps and cleaners you use are pretty toxic, and that can be problematic for you and your staff, and at the very least as it goes downstream, tat's not great. We have alternatives that are made right here in the Navy Yard in Brooklyn that will ultimately save you money. They're just a heck of a lot better for you and your your employees and your patrons. And that's something you can, in turn, advertise to your customer base, that you use non-toxic products in an environment, and a city in New York where that was certainly seen as a pro. We thought that would be attractive. But yeah, that was really the pitch and from there people usually asked for sample products, and we would offer that, and we would do a training. As with many things, it's how you use it and green products often do require a little more elbow grease or a little more studied application than their toxic counterparts. So it was a good test of my Spanish too, because a lot of back of house restaurants in New York are Spanish speaking folks. Working with them, and trying to get them to understand the benefits of the products wealth for their health, their safety. And sometimes it's a hard pitch, because again, they're the ones who have to work a little harder to use a green product, but maybe it's better for them. So it was really interesting to interface with so many wonderful, hardworking people behind the scenes at New York's hotels, restaurants, bars. The Batali group was one of our long standing clients. So getting to go behind the scenes at all those restaurants when they opened the Eataly. If you ever been down there, we did a big conversion. And, again, fun, challenging, exciting, drive up to Boston and Connecticut and these 20 hour long sales events sometimes. We had a truck that we ran on, it had been converted to biodiesel, and we literally picked up the frialator grease from some of our clients, and ran our delivery truck on that. Of course, it wasn't a very reliable truck or mechanism. So driving down to Philly, pulling off the highway because the enging us smoking and smells like french fries. It had it had its moments, for sure. And it was just zany. And you kind of had to roll with whatever happened.
Mordecai Rosenberg:That's quite an experience. I want to talk about sales, management and sales coaching a little bit. I know you're someone who has made a science out of out of sales. Both in terms of books that you've read and courses, right. But then there's also coaching and and training. It is interesting to me to hear you talk about your first sales experience with like, the louavem and estrogem and how you really studied what does make a good one or not a good one. So we'll talk in a little bit about the studying that one can do to improve their sales capability. But I want to start with what good coaching looks like. I mean, you've worked for a number of different people, now you run your own company. But at Greystone, that was probably the thrill of manager and coach, right? And you try to invest in that. But I'm curious, like, just with Greystone or otherwise, what did you find? What makes for a good sales coach in our industry, or bad sales coach?
JD Stettin:Hmm, it's a fun question. Thinking back, I think I gained immeasurably from doing sales calls and visits with you and with Donnie. I think all the training, all the books, all the written anything, those are all fine and good. But give me like five sales trips with you and or Donnie, and that was all the the coaching, training, management that I feel like I needed and enabled me to thrive. There's something about that. I think of it more like a medieval apprentice guild type model. And I think for me as a life philosophy, just aligning myself with great people or finding great people and then just hanging out with them for a while. That's how I ended up with the degree I have. I've ended up studying evolutionary bio and linguistics and there is no thought behind it more than just, one of my professors in evolutionary bio I thought was wild and brilliant and amazing, and one in linguistics, and I just took all the classes that each of them offered. And it's like, oh, that's a way to get a degree. I feel similarly with my experience at Greystone and I vividly recall some of our sales trips and meetings more so than the phone calls, although some of those too. I think just sitting in on meetings with you and really the first few trips we ever took, I probably didn't do much more than nod and take notes while you or Donny took the meetings. Just watching, experiencing maybe, the pattern of mind and questioning and cadence. The way that you and your brother would roll a deal or clients or opportunity just through this mental rubric of sorts. That was, for me, a string of aha moments. They're really feeling like, Oh, I get it. I get it. I get it. It's just watching you guys ask questions and watching the patterns of mind and the patterns questions. That was it, that was what I needed to be able to then go off,and do it on my own, and train the folks who are under me. And then ultimately go off and start my own firm. But really, those ride alongs with with you guys, that was where it all happened for me.
Mordecai Rosenberg:Yeah. Those were some good. Yeah, I was thinking about, I forget if it was Dallas or Houston, and we were definitely doing a lot of driving in Texas. As far as aha moments, anything stick as far as, when you talk about patterns of mind or questions. Anything jump out?
JD Stettin:I'm trying to think maybe it'll come to me as I talk about, it in terms of specific care or finance related questions or ways of approach. But I think to me, the overall modality was more one of this blend. Obviously, slightly different proportions between you and Donnie, but this blend of just sort of curiosity. It never felt like we were going somewhere to, quote unquote, pitch someone. In a way that, and no disrespect meant towards EqualLogic solutions, but that very much felt like the way I was trained there, not that I got very much training in a five person company where everyone was doing everything, but it was very mission driven. We're green. We're going to go in there and tell them they got to use our product because everyone's got to use our product. That's one approach. But it never felt that way with the with the road bros crew at Greystone. It really felt like this is all exploratory and curious. And it felt like, you guys would approach a meeting really just as an opportunity to understand who it was we were meeting with and what it was they were doing. And somehow out of that understanding would often enough arise some opportunity. One thing that maybe comes to mind now, and I guess, this is my first HUD closing, so it's hard to forget. This was actually the trip, I did a day in Dallas with Donnie and then flew to Houston that night, and you came in that morning and we did Houston together. But but the Dallas meeting with Donnie we had lunch with this one prospect . He's a guy who I had, I guess my my fervor as a new sales guy, cold called at his home on Christmas Eve and he had been a sales guy himself. So he was actually really funny about it and we kind of joked and played it off. And we ended up sitting there for lunch, and the opportunity that had brought us together turned out not to be an opportunity. But he mentioned something offhandedly about another property and Donnie just asked a few follow up questions, and pulled a pen on a napkin and quick kind of NOI Cap rate evaluation. He was like, hold on, if that's really the NOI you're throwing off, we could probably pull out like $6 million or something of cash out and have a $24 million deal. The client put down his knife and fork and said, you do that you have a deal. Really just that approach going into it knowing that the deal in question was probably not a fit, and it was unclear, and this guy had just started his own entity. But really approaching things with curiosity, I think, and humility. And really driven to understand, it took all the pressure off of the sales meeting. It no longer felt like we're going in there to sell. None this ABC, always be closing, Glengarry Glen roster. Maybe ABC always be curious, I guess, I don't know. That's another way of thinking about it. But that's something that you and Donnie really, I think, brought to every meeting. That curiosity, and turning a deal over, and a situation over, and asking questions, and really finding what made people or their projects or their properties, tick. And doing so in a CRE setting. So learning the questions to ask about operations dutch service, and plans, and download goals, and questions. And, I don't know, have you tried this? It's just such a beautiful, for me, very natural, very natural feeling approach.
Mordecai Rosenberg:Yeah, it's interesting. For me, that was the part that I really enjoyed about sales was the connecting with people, and the curiosity, and getting to know them, Then looking for opportunities to add value. Like how could I help them think about something a little differently? I was in origination for for 10-12 years. The reason why I left it was because the actual deal itself was the least interesting part about it. Right? So as soon as it got to, alright, well, we can refinance, we have this, this loan product. That to me was less. It didn't feel like I was adding the same kind of value, and it was more structured and wrote. So it almost became a little boring for me. But the part about actually getting to know people and understanding them, and then to give them, advice that part was great. So that's actually why I think I enjoyed doing the podcast so much because the whole purpose is just about trying to understand people and get wisdom from them and share wisdom. But you're right, because those were enjoyable, those meetings.
JD Stettin:Yeah, they were needed. I mean, we definitely met with a cast of characters. Remember that fellow in Houston who greeted us in his toe socks and had the under the desk recumbent bike? And was making the fastest pipe in the West for internet access.
Mordecai Rosenberg:Oh my gosh.
JD Stettin:Right?
Mordecai Rosenberg:Some of those properties we drive up to you hope that this is the wrong address. This can't be where we're actually going. I remember Donnie and I once went to a property in the south side of Chicago. And we didn't know neighborhoods. But we were meeting the client at this building and there were metal detectors out front. It did not feel like a safe place. I was shocked that our car was there when we got back. But I remember we went up and we were looking at this unit. And I asked, so is there any crime? What do you mean crimes? Well, any shootings, or anyone killed? He's like, well, no shootings. It's like, well, what do you mean? He says, well, someone was thrown off a balcony.
JD Stettin:Oh wow.
Mordecai Rosenberg:Yeah. I think we did not end up doing that deal, though. But we tried. We tried.
JD Stettin:I think for me, some of those visits were also really eye opening. And I mean, I, arguably, I would say come from pretty humble origins financially, and grew up next to some low income housing projects in Queens. And yet, even so, driving out and seeing some urban poverty and seeing real class-c housing in Dallas and Houston in Memphis. I don't know that was also moving sometimes in ways. And obviously we were there to make a connection with the owner and again, explore the possibility of financing and refinancing. But just seeing the way experiencing, even for a few moments, the way that people who are relegated to that sort of affordable housing, after live workforce housing, whatever we want to call it. I don't know what to say other than it really was eye opening and a little perspective changing, even even for me. And made me I guess, appreciative all the more of my luck and my privilege, and then my experiences. Doing some of those site site visits. For sure.
Mordecai Rosenberg:Yeah. Well talk about site visits a little bit. Because I think that's something that sales people don't necessarily always feel is part of the process. Right? You meet someone in their office, and you have a good conversation, but as far as financing a property, it's almost like, well, just tell me the financials. I don't need to see it. But I do think that there's value in actually going to see a property, ideally, with the client. But even if even not with the client, if you can't. What do you think about that? In terms of site visits, do you think it's important or not important?
JD Stettin:I think it's very important, as you start in the industry, to actually walk through a certain critical mass of buildings of different asset types, qualities, locations, etc, to really get that embodied, kinesthetic sense of place. What does a 60s nursing home look like versus a freshly built high end assisted living where people pay $9,500 a month to live. I think that gives you certain embodied wisdom or knowledge that you can't possibly get from looking at numbers and building and reading packages or appraisals. I always think about that famous New Yorker cartoon with a New Yorkers sense of America. And it's basically like Times Square, Broadway, 10th Avenue, Hudson. Then there's a sliver of Jersey, flyover Texas and LA. I think there is a provincialism to being from New York where we just, don't I don't know, it's its center of gravity. So I think especially for New Yorkers, New York based finance guys, getting out hitting the road doing site visits, is essential to understanding what it means for a building to serve a community, or be part of a community, or understand what employer dynamics look like in an area so that when you read reports, and look at numbers, you can actually connect them. I feel especially lucky because in addition to all the travel I did at Greystone, I took 11 months and did a cross country road trip with my brother while I was building Carnegie. Part of that was just fun. Part of that was really pedal to the metal and rubber to the road of being in all these parts of the country that we get to work with and work in. Not to mention sitting down and shaking hands with hundreds and hundreds of lenders coast to coast, but really feeling and exploring these communities and living in an air b&b for weeks at a time in these communities, and cities and just getting a visceral sense of the dynamic. And to me, I think those intangibles do speak to the way we do business now, in ways that are probably ineffable. I can't always put my finger on, but feel like an important part of the experience and knowing the landscapes and the people. That being said, certainly the last couple of years with a pandemic, but even before that, I'd say maybe the two years leading up to it, I really haven't been traveling as much for work and doing as many site visits. I don't think the work suffers for it. I do think to me, and this is just my experience and dependent understanding of it, having been on the road so much so early in my career, and then founding even this company gave me at least enough of a sense of things that when I now look at an appraisal, or play on Google Maps to see where a property or project is, I can fit that into this map have lived and traveled experiences that I've had in these cities and states and markets and facilities. I personally no longer feel that it's quite as important for me to walk every nursing home or look at every construction site in a way that 10 or 11 years ago, absolutely was critical.
Mordecai Rosenberg:Yeah, that makes a lot of sense. So when you left Greystone you started Carnegie capital, which now how many years ago? Eight years ago?
JD Stettin:Yeah, I think I left Greystone, a little over seven and Carnegie shortly after. So it's about seven years. Yeah.
Mordecai Rosenberg:So Greystones was a direct lender, doing FHA agency bridge loans. And you went out and started Carnegie, which was going to be a broker, right? To arrange an advisor but where you would be not a direct lender. You had a name behind you, which gives credibility to a phone call, right? And you went out and you now were starting something out of out of thin air. And you've built the business at a really impressive rate, So congratulations on on that. But I guess there are certain things that you think drove the decision at the time. But looking back, you can also think about it differently. So what do you think as far as the idea of being a direct lender versus unaffiliated? How did that compare? And what benefits do you see to either?
JD Stettin:It's a fun question, too, And hearing something you said before about for you, the excitement was in the initial meeting with people and getting to know them and understand them and get a sense of what their problems, pain points were. And then the actual execution was maybe less interesting. That resonated for me hearing you say that. Not that HUD loans aren't easy, or wrote. It takes a lot of smarts and talent to get them done. But for me it was also a sense of a little bit of yeah, maybe boredom or lack of interest in that part of the process once we get them in to HUD. Granted, we all had a somewhat hands on sales, approach and guided and managed and help solve problems all the way through. But for me, there was this sense of, kind of like the chase. It was exciting to get these deals, and then you funnel them into underwriting and just hope that they close. There's something exciting for me about brokerage in so far as we're not limited to any product, to any lender, to any back end. And the internal guiding principle for David and for me is, if this is a deal that makes sense to us, that based on the merits of the market, the underwriting the sponsorship, we feel like this should be doable, we have the freedom to go out and find the right person, sometimes it's only there's only one to get that done. So there's a lot more creative control in that, a lot more variability. We work with a lot of different lenders and banks and CUSOs and CDFIs, across the country. Sometimes that's part of the challenge, because it isn't a boxed product that rinse and repeat it. To a large extent a lot of these loans stand on their own because of the lender in the process. But there's something exciting intellectually about that, and keeps the deal alive for me in a way that I didn't feel quite as much focusing more on FHA. I think there was also something for me about going out there at Greystone and developing all these relationships and going to conferences and doing countless lunches and dinners and road shows, and then having a limited array of products to offer. And then you fit bridge or agency or FHA, or we can't help you. At Carnagie, if we like a borrower and a project, again, they're the sky's the limit, in terms of how we can get it financed, and what resources we can pull, and who we can work with. I just think I really like that model where we get to be. I think also I like being the agent for our clients. We represent them, we don't represent anyone else. And we are unlimited in our potential to help them without trying to shoehorn them into any particular product or lender. It's really whatever's best for the client and the deal. And that felt really exciting and satisfying. Also a little bit more, I wouldn't say instant ratification because nothing in our in our line of work is instant, but in a way that I think in the FHA world, you can nurture a relationship for years before someone has a need, or an appropriate deal for FHA. Whereas with what we do now, any CRE need, although we mostly focus on seniors, housing and health care, any CRE need can be filled and met by us. It's exciting to be able to work with a client and seniors and then they tell us, actually, we have a bit of a storage portfolio, can you do that? And, sure, we know how to underwrite that, the lenders are often the same. And it feels, for me, really gratifying to be able to be so closely aligned with a client and get to help them with the full range of whatever they bring to the table.
Mordecai Rosenberg:You know, when you are a direct lender, and you go to a conference, you go to the NIC or the NMHC, or any conference, you're there and you are competing with every other lender. I think that one way that you were able to enter into the market was by making your competition into clients. And you also knew that there was this void that you evidenced. That if someone wanted FHA loan they oftentimes would need a bridge because it took so long, and a lot of lenders were not providing bridge. So being able to make all these other lenders into your clients and referral sources, I think that also opened up a whole new frontier.
JD Stettin:Yeah, thank you for saying that. I think so too. And I think there's a way in which my experience, EqualLogic selling through distribution, sort of colored my thinking about this too, in a way. I can go out there, try directly to talk to the clients, or there are people like originators at Greystone or Walker, Prue who are funded by these big institutions to go out and talk to clients, they're already doing that. That's an existing channel. Let's piggyback on that channel, the tracks already exist, let's ride it and add value where we can. And I think the other thing too was we just built Carnegie to be the toolkit that I wish I had, as an FHA originator, so that we can be there to fill in the gaps. We're never competing with anyone's bridge program. We're there to fill in the gaps for bridge programs, things they can't do. So many agency lending bridge programs don't do construction, or have size limits, both on the lower end or the higher end, or cash flow needs. Where the agency and FHA lenders have a product or program that fits fantastic, and where they don't, land loan construction, cash out, non cash flowing, whatever it is, we wanted to fill in that gap. And, again, be the the help we wish we had when we were doing this. And it really happened organically. There wasn't some great master plan. There was just getting a little frustrated, not being able to provide much beyond FHA, seeing the opportunity with brokerage, being creatively excited about it, and then thinking, this is great, we can just build the tools that we wanted when we were doing this. It's been really natural, really organic. We don't really do any outbound marketing or advertising or sales. It's really through existing channels through people we know at these trusted industry wide institutions who send us deals and clients when they don't fit their their buckets. We've just ridden that wave for seven years and repeats and referrals. Again, it feels like in the spirit of the way that you guys trained us to sell too where there's there's not a lot of sales happening. There's just question asking, curiosity, and hopefully problem solving, or the recognition or admission that yeah, this is a problem we can't solve. And we probably turned down 50 to 60% depending on the year or the month of the deals you received because we don't see a way that we can solve or add value or do anything different than what someone's already doing. And that's really refreshing too. People appreciate that. I've had so many clients or prospects thanked me when I've told them that yeah, the deal you're getting from your local bank is actually the best thing we're seeing on the market, so why pay a broker when you're getting that from your bank direct. Sometimes that's the case and that's wonderful. I think a metaphor I really like that we use for what we do at Carnegie is, some guy comes out of a bar, and he sees his friend looking for his his keys on the ground, and he notices that his friend is looking for his keys under the one working lamppost in the parking lot. He comes over and he says, Hey, John, did you lose your keys said, yeah, he goes, Oh, did you lose them over here? Is that why you're looking? And the guy says, no, no, don't use them over here. And this friend says, well, then if you didn't lose your keys here, why are you looking here under this lamppost? And the guy says, Well, that's the only place where there's light. And I think that feels true to me of our industry, in that so many people go back to the same lenders and funding sources because that's just what they know. That's where the light is. Those are the guys who come to the conferences and do splashy ads. They're the people you read about in all the publications every week closing loans, and they do good work. That's why they're big and in the publications. But there is an entire parking lot worth of places. That's what we wanted to do when we built Carnegie, is not necessarily focusing the usual suspects, the obvious place where there's already so much light being shed. What about the 5500 FDIC insured banks, the 1000s, of credit unions, the CUSOs, the CDFI's that I didn't even know existed until seven years ago, as you know, entities leveling funding sources. So it's been really fun to kind of expand that horizon for ourselves and for our clients in terms of what's out there.
Mordecai Rosenberg:Yeah. Another analogy that comes to mind let's say, you have a heart problem, right? So you go to one practice, and they say, yeah, we just do this one procedure on the left ventricle, this is like our specialty, we can do that. Like, well, do you want to go to that doctor? Or, do you want to go to one who can give you something like, well, actually, you know, there's this other procedure, where, you know, you can just, it's non invasive, and there's something else where you can experiment with diet. But it's not a small thing. It's not like getting a lease for your car. Which is still a big thing. This could be a $50 million dollar property. And the debt is the, in some ways is large.
JD Stettin:Yeah. And I think it's interesting, hearing you put it in terms of medicine. It's something I've actually been talking a lot with my friends lately about the need for guides, in the medical field. Not doctors, not specialists, not surgeons, but people who guide, navigator. People who can help make you aware of the array of interventions, and options, and take a more holistic approach. Because, absolutely right, you go to the surgeon they want to do a cut, you go to the interns they want to give you meds. And that's great, and represents their training in their habit of mind. But how wonderful to have a guide or a coach who maybe isn't as deep in any one field, but can see the whole field. Kind of thinking like a football metaphor, why the coaches are on the headset of the quarterback, they see things from truly a different bird's eye perspective that even the best quarterback can't see, certainly when he's in the game. So being able to kind of, and I don't claim to have access to every single ending source in the country, but really working towards that goal. We like to think we bring an aspect of that vision to our clients when they make these big decisions about how to buy or build or recapitalize their property, with that global sense. And without being a specialist in one small product type. So yeah, that also feels useful and feels intellectually curious and satisfying too. And just how many banks can we talk to, and work with, and learn from?
Mordecai Rosenberg:Yeah. Continuing with the medical metaphor, like in medicine, there's incentive for specialization, right? The more highly specialized you are, oftentimes the better paid you'll be, the more the more prestige there is. But I feel like in any industry where there is such a premium put on high specialization, the generalist has unique value. Just like in just like in medicine where you really want, with all this specialization, a guide who can just give you the big picture advice. Our industry is the same. There's people who focus on their lists. You you look at commercial mortgage alert, and they come up with these with these lists, right? And there's the top mezzanine lenders, right? And there's 200 mezzanine lenders, right? And theirs top bridge lenders, and there's 500 Bridge lenders, right? And there's FHA lenders, right? So it's become very, very specialized. So I think that's where you guys add such value. For anyone listening who is a direct lender and has a need for your bridge, I know you specialize in healthcare and seniors housing but also do multifamily?
JD Stettin:Yeah, we do a good amount of multifamily. We use some storage, office retail, hospitality. I think the only asset class we probably haven't touched as manufacturing facilities. We're happy to be a support in terms of finding homes for your deals or your clients where you can't. Also alternatively, on the other side of the same coin is bringing you guys lenders deals when they come in to us from clients where where we think you guys are the best fit for something.
Mordecai Rosenberg:Yeah, that's awesome. So, JD, if people do want to find you afterwards what's the best way to get in touch with you?
JD Stettin:Probably the best way is via email. And simplest email for me is JD@carnegiecp.com. That's J like John D, like Daniel at Carnegie C, like capital P like partner.com. And for what it's worth, just because bringing we're it up, the Carnegie name is a bit of an homage to where my partner and I come from, which is having met working back to back at Carnegie Hall tower with you Mordy and your team at Greystone. So both in some ways, an inspiring entrepreneur in his own right. And, of course, there's a complicated legacy there. Not all of it, is great, but aspects of the way he built his firm were impressive to us. And also it felt true and right for how we met and how we really built our partnership, which was in Carnegie Hall tower with you guys.
Mordecai Rosenberg:That's awesome. Those were good times. I'll close with just one final point. And I'll let you comment as well. We didn't talk about David so much on this in this discussion. But I do think that one of these really well kept secrets in the sales industry, is the importance of an execution, of having an amazing execution partner. I think that what you would find, the sales guy is the front end. They're oftentimes in the spotlight. They're the ones who are in the press releases, right. But I have a feeling that if you look at the top salespeople in the industry, you'll find that they have excellent execution partners who are the ones who are actually getting the stuff done, doing the work of the deal. Any any comments on that?
JD Stettin:Couldn't agree more. Behind every great originator is a great analyst or underwriter. And that's something on every level, every job I've had, every company I've worked for. I was a bartender at a restaurant, so being forward facing with the clients. But ultimately, you're only as good as the chef and his team are. That seems like a very clear example of what's called front of house back of house split. It's the bartenders and the servers who interface with the clients and get tips and get rated, but who's in the kitchenmaking anything. To me, that's always been so clear. And part of what I actually struggled with at EqualLogic, conversation for another time, in terms of the support and the infrastructure backing up our product and our sales. It felt like we were growing too far, and outpacing our ability to really execute and serve our clients. My opinion of course. I think that's one of the things I am most, whenever we're doing like gratitude exercises or meditations, one of the easiest things for me that comes to mind first and foremost is gratitude for my partner David for his talent, for his tenacity, for his creativity. And he is, what do they say and in the old Hollywood world, a triple threat, they can act dance and sing. So David, is that on the underwriting side. The guy can underwrite, he's personable, he can sell, he's creative. His packages aren't just comprehensive, but they're they're visually striking. He's just a catch, he's the complete package. I think he's probably no small part of how our our team, your team at Greystone was able to do so much in such a short period of time. He is absolutely the reason that Corning he is able to do what it does. We joke sometimes oncalls and tell clients on the show horse is the workhorse. Which, you know, it's an exaggeration, of course, but it points to a truth. Having someone who really understands deals so deeply. It is amazing to me the way that David uncovers value in deals that oftentimes the owners and operators themselves couldn't see and didn't see, that the appraisers missed. And he also, as you probably know, has this way. He is such a gentle and humble person. Sometimes watching him build a case with folks who don't have a tenth of the underwriting chops or Excel fluency as him. His manner is so easy, and gentle, and kind. I think that resonates with underwriters and appraisers around the country. So David is definitely the secret sauce and the black box of Carnegie behind the scenes. I have a lot of gratitude for him. Working with someone that closely for so many years is also an amazing thing. From our time at Greystone to Carnegie, it's been,I don't know, 10 and a half, maybe 11 years. There's this way, and I'm sure, some time in the future cognitive science will show us how this is true, but it feels like we share brain cells at this point. Almost we each have kind of a dual personality, business wise, that's part us part, part the other partner. And that's also been an amazing thing to work with. I think in terms of the joy I take in what I do, so much of that joy is brainstorming about deal and deal strategy with David. And we have a very, very open relationship. And there's no pride of authorship of ideas. It's really about finding the quote unquote truth for any given deal or circumstance. And we shoot down our own ideas, shoot down each other's ideas, and it's so not personal. It's so about the deal and the idea and what works and it's been an incredibly rich and generative partnership for me, and I think I hope for David too.
Mordecai Rosenberg:Awesome. Yes. So that's definitely some great closing advice for any salesperson. if you want to be a great show horse, find your workhorse. Hitch your wagon and hold on for dear life.
JD Stettin:Hold on tight. Yeah, hold on tight. They make everything sane. I will say as a final thought on David, a lot of people don't know, but he is actually a great artist and is painting. And as a sort of thank you gift for this large transaction we closed this last year. It was a nine figure deal for a big client with one of the banks we really like, and actually the client wanted to get something special for the bank. Then it turned out this banker collects Air Jordans. That's a thing people do. It turns out that David collects and paints hand paints Air Jordans. David collaborated with this client to do this custom pair the bankers name is Jared, of Air Jared's. Put in, I have to think, over 100 hours of work with a tiny brush and actual real gold leaf paint to do it in the clients colors, and with the bankers name. It's just this beautiful, creative side that I think often goes unnoticed in underwriters and analysts. Certainly David is among many other talents. A great artist. I think it's nice for people tovknow that and see it. There's a tendency to think of, underwriters in Excel. There's a sort of, maybe robotic, mathematical scientific side, but with David, there's also just tremendous creativity, and art. That's one of the joys of of working with him and knowing him.
Mordecai Rosenberg:I love it. I love it. Well, JD it's always a pleasure, my friend. So good to chat. And we'll be in touch, we'll talk soon.
JD Stettin:That sounds great. Thanks for having me on. Thanks for making origination interesting.
Mordecai Rosenberg:Okay. Talk to you later, man.
JD Stettin:Bye. Take care Mordy. Thanks, bye.