340. This 34-Year Old Built $500M of Real Estate - Here's How

 
 


This 34-Year Old Built $500M of Real Estate - Here's How


Most people think real estate is all about luxury condos and chasing the biggest margins. But what if you could build a portfolio that actually makes a difference—while still making a solid return?

In this episode, I sit down with Evan Holladay, founder of Holladay Ventures, who has already developed over $500 million in affordable and workforce housing across the Southeast. His mission? To create 100,000+ units of housing that teachers, nurses, and service workers can actually afford.

We cover:

  • How Evan got started in real estate after nearly becoming a doctor

  • The first deals that gave him confidence (and the ones that almost fell apart)

  • The biggest lesson he’s learned about picking partners and capital sources

  • Behind the scenes of Stonebridge Lofts—a 311-unit Nashville project backed by Amazon’s $2B housing fund

  • Why affordable housing isn’t what you think (and why families making up to $80K qualify in Nashville)

  • How to structure deals that balance mission and margin without sacrificing returns


Whether you’re a developer, investor, or just curious about how real estate can be a force for good, this conversation will change how you think about building wealth and building communities.

Get commercial real estate coaching, courses, and community to jumpstart your investment journey over at CRE Central: www.crecentral.com

Key Takeaways:

  • Affordable Housing Impact

    • Serves families making $22,000 to $80,000 annually

    • Provides housing for essential workers like servers, government employees

    • Goes beyond buildings to create community and support services

  • Development Philosophy

    • Focus on creating unique developments with local identity

    • Partner with nonprofits to provide resident services

    • Prioritize sustainability and community-centered design

  • Career Journey

    • Started in real estate through mentorship and hands-on learning

    • Founded Holiday Ventures to create more mission-driven housing developments

    • Raised initial capital through brand building and podcast

  • Project Success Strategies

    • Carefully select development sites and partners

    • Build relationships with local government and community leaders

    • Create contingency budgets to manage market volatility

  • Mission vs. Margin

    • Balance financial viability with social impact

    • Seek partners who share core values beyond just profit

    • Use creative funding sources like grants and corporate housing funds

    1. Personal Growth

    • Learn from mistakes in partnerships and deal-making

    • Continuously educate yourself about market dynamics

    • Stay committed to long-term community development goals

Subscribe to the Podcast


About Your Host:

Tyler Cauble, Founder & President of The Cauble Group, is a commercial real estate broker and investor based in East Nashville. He’s the best selling author of Open for Business: The Insider’s Guide to Leasing Commercial Real Estate and has focused his career on serving commercial real estate investors.


Episode Transcript:

Speaker 1 0:00

I had lunch with the council member, and he's like, my cousin owns that. And the sellers are always calling him once a year, saying, Hey, will you buy my land? Phone call later, made her an offer on Wednesday. We were under contract on Friday, and then at that point I was like, oh, did I pay way too much money for this? Because she accepted that way too fast. There always is unknowns, and so you have to have contingency in your budget for those unknowns, or else you will be out of a job and you will not be a developer for very long, or partner with somebody and they just are only concerned about money, then that's not the partner for us. We want somebody that, yeah, wants to make a profit, but also really cares about impact and helping people

Tyler Cauble 0:40

in a city where teachers and construction workers can't afford to live. Evan holiday is building a different kind of real estate business. He's not flipping luxury condos or chasing short term upside. He's focused on the long term impact, developing affordable workforce and mixed income housing across the southeast with a goal of creating over 100,000 units in his lifetime. But don't let the mission driven end goal fool you. Evan knows how to structure a deal, from leveraging pilot programs to stacking tax credits and building creative public private partnerships. He's found ways to make complex projects pencil without compromising the end goal, Building Better Communities. In this conversation, we dig into how he got started, the deals that nearly fell apart, how he picks his partners, and what cities like Nashville need to get right if they want to actually solve the housing crisis. Whether you're a developer, investor or someone who wants to build with purpose, this one's going to be worth your time. Let's get into it. So, Evan, you've developed over $500 million of multifamily housing at this point, but I want to take it back, what originally inspired you to get into real estate and specifically affordable housing?

Speaker 1 1:53

Yeah, for me, really, I thought I wanted to be a doctor in school, and I realized very quickly that was not my my path, but I saw this student housing development. It was a $55 million 380 student bed 12 retail Bay development, and they were going to develop a whole city block. And I just knew I, like, something was telling me, I was like, All right, that I got to be a part of, like, I got to figure out a way to to learn from that, or be a part of it, and it got me really excited. And so basically just figuring out how to get my foot in the door, you know, using relationships. I had a mentor that I had just offhand, mentioned it to him, and that led to getting introduced to the developer. It took many times of follow up and follow through to get him to give me an opportunity, but he hired me as basically a leasing agent, and that's how I got my foot in the door, and I realized was like, this is a blast. I love this. I love being around it, but I don't want to be a leasing agent. I don't want to be on the management side. I want to do what he's doing. I want to put the deal together, and I want to see the vision, and I want to, like, create neighborhoods. And then at the same time, I volunteered for a nonprofit called Family scholar house. They just they do amazing work, helping single mothers go back and get their college degree and give them the support, the network, the community to do that, and the affordable housing and volunteering there just opened my eyes to seeing okay I can, I can help people, and I can build stuff. The best way for me to do that is affordable housing, and I just went all in and from there, started a modular development company in college, me and four other students, we were so green, we knew absolutely nothing, but we just had an idea, and we ran with it, and we were looking for partners to do a 20 unit development in Louisville, Kentucky, and that led to pitching a group to partner with us, and that pitch ended up turning into a job opportunity. And I just knew, I was like, this group is an up and coming, affordable developer. They're, you know, one of the 15 biggest in the country, and they're, they're on the rise. I was like, I knew I could learn something from these guys. I could, I could basically hitch my wagon to them and figure out a way to, you know, kind of take the apprenticeship model of, like, how can I learn from these guys who have already done it? And they just threw me in the deep end. They said, Hey, go figure it out. Go figure it out in Texas and Louisiana and Florida and basically all over the southeast. And they're just kind of went until it stuck, and that's where I really figured out. I was like, Yep, this is what I'm supposed to be doing, and I loved every second of it. So, yeah, that's, that's really how I got my start in affordable housing. Yeah,

Tyler Cauble 4:31

you were really able to cut your teeth at LDG. I mean, how did your time there shape your perspective on affordable housing and your approach today? Yeah.

Speaker 1 4:39

I mean, I am so grateful for my time there, because I was, I just turned 23 and they were literally putting me, maybe, you know, they had somebody mentoring me, but I was more or less leading new development in New Territories. I mean, what other company, what other you know, business gives that opportunity to a 23 year. World, you know, I think it was they believed in me, but also maybe a little bit of risk involved. But that opportunity gave me a lot of at bats, and it gave me the ability to, you know, I was looking at deals in Baton Rouge and and New Orleans and Brownsville Texas and Austin, Texas, and, you know, Fort Lauderdale and Miami, and I was going all over Nashville, Clarksville, like, you name it, like, all over the southeast. And I was meeting with council members, I was meeting with brokers, I was looking at sites, I was filling out funding applications. I was negotiating deals, and a lot of them didn't stick, but it gave me enough at bats, but I learned so much there, and I spent six years there, and I worked on 1300 units there, all deals that I sourced from start to finish and got closed. And that's really how I was able to really grow so quickly, was they threw me in the deep end. I was able to just learn tremendously from mentors, take action and be able to figure out ways where, you know, follow along their footsteps. They always said, we've made 10s of millions of dollars worth of mistakes, so hopefully you only make million dollar mistakes. And I thought in my head, you know, I'm making like, 50 grand at the time. I'm like, Okay, I don't want to make any mistakes. I don't want to spend there a million dollars. Like, that's crazy. But it opened my eyes to realizing like, the point of mentors and the point of learning from others ahead of you is so that you don't make the big mistakes that they made. It's okay to make mistakes, just learn from the bigger ones and don't do those. And that really opened my eyes. And also realized, like they they were really focused on scale, which I which I believe in. But there are also things I learned that I didn't want to do, and that's why ultimately we started holiday ventures was, you know, they had a very repeatable process, a repeatable product. And I didn't want something that was cookie cutter. I didn't want something that was the same in Nashville as it is in Austin, Texas or Louisville, Kentucky and and I think that works for others, but for me, I wanted something where each development has an identity, a purpose, an audience, and is meant to help a certain type of person on their journey through affordable housing. But not just affordable housing, it's also about the services, and it's about the placemaking, and it's about people being proud of where they're living, and so I think that's what got me really excited, and being able to do that on our own. Now I've learned along the way. You know, it didn't all just come to me one day. It was kind of learning as we went, but I realized is like, the better we can make our communities, the better the outcomes will be for our residents. If you give someone pride and where they live, and they can afford it, and they don't feel burdened, then it gives them the ability to have that upward economic mobility and give a better future for their kids. And so that's really kind of what, what rooted all of what we're doing in holiday ventures. But I learned so much what I what I wanted to take away, and also what I didn't want to take away from from working there?

Tyler Cauble 8:02

Yeah, we'll dive into your Founding of holiday ventures here in a second. But I'm curious. I mean, one of the most challenging aspects of getting started in this industry is learning new markets. And when you're first getting started, you're thrown into all of these different markets, right? That are all over the country, incredibly different. I mean, Nashville and Brownsville couldn't be more different. How are you how were you able to grasp how different these markets are and wrap your mind around the dynamics within each market so that you could understand, okay, this is what we need to deliver here. This is what's going to work here. Here's how the demographics work in these markets. Yeah,

Speaker 1 8:38

that's a great question. And I think anybody you know working on their first deal is always thinking about that or looking that or looking at new markets. And I think it didn't come, you know, in one fell swoop. I think for me, it really it came by just taking action, and it came by being boots on the ground. I think nothing we always talk about this in real estate, like there's nothing better than being in your market and seeing it firsthand, meeting the people who are really the market experts. And so that's every time I went to a new market, I would try to find out who are the market experts. I would start with city managers. I would start with economic development or housing authorities or council members, or really brokers. I mean, brokers are the key because, one, they want to sell you something, and they want to help you find your land, and two, they are usually some of the most connected people in the market. So starting with brokers, and then working your way up to city leaders, city managers, who are going to connect you, especially within affordable housing, help you figure out the markets. But honestly, I just love driving markets, because I can get a good grasp, I figure out all the economic data before I go to a market, even just starting with Wikipedia. I mean, now we have chat GPT. You can literally look up market data in like two minutes, but starting with that as a good baseline background, and then also looking up news, like going to Google News and just looking up. What's going on in the city, what are the economic drivers of that city, and then what parts of town are already seeing redevelopment, and then overlaying where we can afford land versus where I think development is headed based on all the data I'm seeing, and then also overlay that with the conversations I have boots on the ground with brokers and city leaders. And that's, that's ultimately, you know, there's no straight, there's no straight road to getting there. But I think having those conversations what helps you get to the point where you feel like you're somewhat of an expert, but you always have to rely on locals.

Tyler Cauble 10:34

Yeah, that narrows it down pretty quickly. Yeah. Tell us about founding holiday ventures. I mean, what was your vision then, and how has it evolved

Speaker 1 10:41

today? Yeah, so founding holiday ventures. It was always in an idea in my head, but really, and I knew, I knew going into working for another company that I wanted to do my own thing, I just didn't know when the right time was. And ultimately, I think the way things ended up, but it kind of gave me the stepping stone to it kind of pushed me to do it, you know, maybe even sooner than I was ready. But I knew that I always wanted to do my own thing. But ultimately, it's scary starting your own business. It's really scary, and because you lose all comfort, you lose all safety, you lose that, you know, every two weeks getting a paycheck, that it was like the hardest thing for me to grab grasp with, and so I did everything I could to make it less scary and going so going into it. We, while I was still working nine to five for another group, I we worked on multiple Airbnbs. So we tried to create, my girlfriend, now, wife at the time. We tried to create other income so that we weren't as dependent on that income. So that was one thing we did. And then the other thing was we started a podcast. We started monumental which we had you on years ago, and that helped build our brand and our audience. You know, we talk about this all the time. It's like, it's so powerful when you build the brand and the audience and and you create value for others, and you create a platform for your guests, and it just helps elevate you to a place where, when, when I was ready to do my own thing, I had asked my audience for nothing, and even when I left, I didn't ask them for anything. But when I did my first deal on my own, and I had to raise a million dollars. I raised it in 24 hours. I was so nervous, even just pressing the email because I was like, I don't know if anybody's gonna respond. I've never raised a million dollars before. You know, all the capital from my previous deals has been through the company or through big corporations like this is a total first for me. I was freaking out. I thought nobody's gonna respond, and I just had this amazing feedback of immediately raising that money, and I knew I was like, Okay, this is because I put in the work for years leading up to this point. But it was still scary. I mean, I started the LLC a year and a half before I actually left, you know, I had it in my mind that I wanted it, but I wasn't ready to fully, ready to commit. I hired a coach. That was a big thing. I had a life and business coach. He was tremendous. He gave me a timeline, and he said, What do you need by this date? I told him the date I wanted to leave. He said, Well, what do you need to be comfortable by that date? And he said, All right, write it down, put it in your pocket and look at that every single day. And I did, and I left three weeks before that date. So really, I think getting to the point where I was ready to leave was not easy. I wasn't really ready to leave, but I jumped anyways and was able to figure it out. But I think a lot of it helped that I had put in the work with the branding and the in the community before I

Tyler Cauble 13:32

left. What do you think it was that finally gave you the push that you needed? Yeah,

Speaker 1 13:36

I think I had, I had hit a point where I had done 1300 units. I had done many developments from start to finish, and it ultimately came down to I, I always wanted to do my own thing, and I was itching. I was like, this, just like continuing to do it for somebody else in their vision. You know, there's some fulfillment from that, but it wasn't really what was driving me. So everything I was working on, I was like, Man, this is good, but I think we could do it better. And that just kept driving me. And then eventually, I mean, it partially, too was hitting a point where I was just getting frustrated with some of the feedback I was getting, and I was like, You know what? I think now's the time like it just hit a roadblock where I was getting so frustrated, you know, deals not going through, that. I thought were amazing deals, or or some of my deals were going to fund other deals that weren't doing well. I was like, well, that how's that my problem? And so things like that, it just kind of hit a tipping point. I was like, You know what? Now's the time. And then once I built up that confidence internally, then I was able to leave. Yeah,

Tyler Cauble 14:39

it sounds like you and I have the exact same situation, yeah, and it's and it's amazing, because I the year that I left and started my own brokerage, three times my best year ever, because I was able to actually go out and implement all of the things that I thought would help that I had never been able to do before. Evan, you've said that, you know, housing is foundational to helping people reach their full potential. I mean, what does that mean to you? Beyond. Just the buildings.

Speaker 1 15:01

Yeah, really, everything we're doing about holiday ventures and the housing, it is, it is ultimately a means to an end. And what I mean by that is, I think affordable housing, especially right now, like it's, it's a buzzword everybody's talking about. Everybody wants to be a part of it, but, but for us, it's more than just the housing. It's, How can we figure out how, in every development we're doing this, we're partnering with nonprofits, either as a development partner or as a service partner, or in most cases, both. So how can we bring in nonprofits at the development level to get them fully engaged with our residents on the property, on the premises, and basically lower all barriers for residents to access services and access support and community and make it a community forward development at the end of the day, like, how do we make it so that there are safe spaces in our community for residents to be part of a community and be able to move up the economic ladder? So we're partnering with nonprofits like uprise and many others that come into our community help do the resident services, and also, we're always looking to expand the nonprofit partnership. So we're working with Urban League of Middle Tennessee, we're working with Samaritan recovery community, and we're working with the Arts and Business Council, just to name a few. On the development side, to figure out, how do we tailor each of our developments to specific communities and help them on their journey? You've

Tyler Cauble 16:26

developed 1000s of units at this point. Do you remember the first affordable or workforce deal that you did that really gave you the confidence that you were on the right

Speaker 1 16:35

path? Yeah, the very first deal. Yeah. No, I remember it so distinctly, so I'll give you a quick synopsis. So basically, we knew a grant funding application was coming out in Baton Rouge, Louisiana. We found a 10 acre site, and it was basically enough room for 192 units, garden style, and we applied for the application. I this first application I ever did, I was putting together the applications over Thanksgiving because I underestimated how long it was going to take to actually assembles physical binder, and I had my parents like hole punching, and my brother assembling like we had a whole assembly line on the table. And we got the application in the day after Thanksgiving. And a month, month and a half later, we found out we got the award. And I was just, I was going bonkers. I was so happy. I was like, Oh my gosh, I'm one for one. Let's go. And so I was like, All right, we have a funded deal. Let's, let's work on, you know, the plans. Let's work on permits. Let's get this thing closed. Let's get our finance partners lined up. And it was a whole journey. I learned by doing, and I drank from a fire hose. But by the time we closed and got the deal under construction, I just remember going on site and seeing, like, I think it was like, 80 guys. I counted, individually counted. I was like, there's 80 guys out here right now. They're working on foundations. And I was just like, holy moly, this is amazing. Like, this is so cool. It's so powerful. Like, what, you know, we're working for. I worked on that for like, a year and a half, and to see nothing for a year and a half, and then all of a sudden, you're on site, and you see 80 guys working really hard towards creating the, you know, what ultimately started out as just an idea, and ultimately leading to helping 192 families at any given time. Like, that's just where I knew. I was like, you know, again, it clicked. I was like, whoa. This is powerful. This is so cool, and this is exactly what I'm meant to be doing. So it started there, and it happens every time we do a deal. Like, you know, I'm like a kid in a candy shop. Every time I like, I will drive by our construction sites, you know, as much as I can every week, if I have a meeting nearby, I'll like take a detour and swing by and they update us on the apps with the pictures I look at it almost every

Tyler Cauble 18:52

day. Now, those earlier deals also don't come without their challenges, right? I mean, especially in affordable housing on the development side. I mean, we're talking about the public perception, policy, raising capital. I mean, what were some of the earlier challenges that you had to overcome that were obviously just new to you, having never gone through this?

Speaker 1 19:10

Yeah, I think the one of the hardest things that was for me to understand at the early days was figuring out how to understand council members and public politics like that, that is, you know, there's there's nothing is black and white. And so figuring out, what do council members want, you know, how do you connect with them? How do you connect with the community? How do you make sure this is something that they want or will support? And so, you know, even the first development I mentioned in Baton Rouge, I mean, we got an award, and we were starting to work on it, and somebody's like, have you talked to the council member? And I'm like, What do you mean? And I had literally done, like, eight months worth of work, and I'd never talked to the council member to make sure that they were on board with this, which is. Wild thinking back now, knowing what I know, I'm like, that would be the step one, like, sometimes before we get sites under contract. Now we're talking to council members just to make sure they're on board with our vision. But back then, I didn't know that, and so I was just blowing and going, I'm like, All right, let's go Google. Let's get to closing. And I'd never got that, you know, that informal blessing from the council member. And luckily, in this case, it was already zoned lane. Already zoned land, and we weren't asking for anything from the local government, so we technically didn't need their support. But regardless, it's it's always something that you have to especially within affordable it historically has had a negative connotation around it. It's getting better. People are realizing that affordable housing can be really quality and well done, and it's a necessity in our in our day and age of housing crisis, and so many people that are the backbone of our economy are able to live and qualify for the income levels of affordable housing. So people realize that to a degree now, so I think it's a lot more accepted now, but even still, that's a conversation you have to have from the very beginning and so and being delicate about making sure you're taking their perspective into account. You're making sure to understand their goals and their desires for their district, wherever that is, that has to be at the very early end. And that was a mistake I made. I made it a couple times in the very beginning, not getting their blessing early enough. Yeah,

Tyler Cauble 21:22

this is probably a pretty good point to actually clarify what affordable housing is and who qualifies for it, because I think a lot of people would be pretty surprised that in Davidson County, if you're making $80,000 a year or less, you actually qualify for affordable housing, yeah, because the median income is what $108,000 yeah. And so affordable housing technically starts at what, 80% AMI, yep. And so if you're making 80 grand, you actually qualify for for affordable housing. So you kind of dive into that,

Speaker 1 21:50

yeah, yeah, that that's a big part of our job is also educating, right? Like there's, there's misnomers, there's misunderstandings out there. And so exactly what you're saying is, you know, we, we typically serve people from 30% area median income up to 80% area median income. Each development is different based on the funding that goes into it. But in Nashville as an example, we're serving families making about 22,000 a year up to about 80,000 a year. So that is a really wide range of individuals. And even if you, if you look at Metro Nashville government starting salaries, that is a starting salary for a lot of government employees, not to mention the backbone of our entertainment industry, servers, waiters and secretaries like there's so many jobs that fall within that income band that are we all depend on every day, and we we know people. We have people in our family in that income range, like there's so many people affected by the housing crisis, and it's and it only gets worse as we go on, because we're not building enough to meet supply. Demand is not meeting supply, or, sorry, supply is not meeting demand. And so how, how do we get there? It's by helping people on all those income levels, but they all qualify for affordable housing.

Tyler Cauble 23:04

You had a massive announcement this past week, so congrats on that stone bridge lofts. You just added 311 new affordable units to Davidson County. Can you walk us through that deal, what worked, what didn't, and kind of what you learned along

Speaker 1 23:17

the way? Yeah, definitely that was I loved putting that deal together, and also seeing it come to life, and seeing it be finished. 311 units, like you said, one, two and three bedrooms, garden style development, over 20 acres, a couple unique things, you know, like I mentioned earlier, each development, we tried to do something different and unique, to make some placemaking into each development. And so this one, we had 11,200 square feet of retail right on the first floor Main Street, basically an extension of Dickerson Pike, which we're on and and we also have a clubhouse, a 5000 square foot clubhouse, that is 100% powered by solar. So as far as I know, this is the first that has been done in the state of Tennessee. But we have three Tesla Powerwall batteries in the clubhouse, so we have a 15 kilowatt array on the on the roof of this, on the on the roof of the clubhouse, and that goes into the the Tesla Powerwall batteries, and then that anything extra actually will go back to the grid. But it is powering up the batteries during the day, and then the batteries power the building at night. So we are 100% off grid for that clubhouse. And the goal was, one, sustainability, two, education around sustainability. We have an education center where we actually have a live data TV set up on the wall in the clubhouse, a really big TV so kids can come in and see, okay, I can see the line from the panel going to the battery, going to charge the building up and education around that, because we want it to be more than just a passive system. We want it to be something where we can help use this as a tool to educate others about what we're doing and why we're doing it. And ultimately, the clubhouse two is. A resiliency hub so that will be powered whether or not we have some extreme tornadoes or extreme weather events that we seem to be getting a lot of here in Nashville, and that can be a hub where families can go to in those times and still have a refrigerator for their for their medicine, or just a safe place to go. And then in the retail we're able to, we have a nail salon, we have, we're talking in depth, talks with a coffee shop and a restaurant, and then even a daycare, Early Learning Center. So trying to just look at, how can we make it more than just housing, but a place where people want to live and they have amenities right downstairs and but a little background on the deal. So that deal, it came about. I had had lunch with a council member, you know, just always building relationships, and realized that this piece of land was was in a growing corridor, in an area also that we target for development, either a qualified census tract or a difficult development area, they published annually by HUD, and it was in one of those areas, which is a, basically a boost in the amount of tax credits we can get for our funding. So it was in a redeveloping corridor and in a QCT. And I was like, All right, this is a perfect spot, 20 acres, plenty of room for us to develop. The only downside is it is, it was a hilltop, like a straight up hilltop. And it was not the right zoning. It was commercial and industrial, which is a weird mix, but it was both. And so I had lunch with the council member before we had it under contract, and I said, Hey, would you know anything about this site? Or, like, what are your thoughts on this site? And he's like, You know what? My cousin lives right next door, or he owns the property right next door. There's a mobile home right next door, and he's like, my cousin owns that. And the sellers are always calling him once a year, saying, Hey, will you buy my land? And he's like, he's not wanting to buy it, so I'll just ask him for the phone number if you want to reach out to him. I was like, yeah, that'd be great. And then, literally, phone call later we she's like, Yeah, make us an offer. Made her an offer on Wednesday. We were under contract on Friday. And then at that point, I was like, oh, did I pay way too much money for this? Because she accepted that way too fast. But I realized, I was like, You know what? Like, it was a good price for us. So good price for them. We're all winning. And so we went ahead and we had a two year contract on it. So I was like, great. We got the time. And fast forward, we were working through rezoning. It took us about eight months, but ultimately, the City Planning Commission in Goodlettsville said they're like, you know, I think they understood it was a hilltop. It's never going to be developed for industrial. It's never going to be developed for commercial. The highest and best use is residential that was attainably priced, affordably priced for families that are already in goodloetsville and also had a retail frontage on it. And so I think the retail really helped sell them, which was new for us. But we said, hey, let's take this as an opportunity. One, to allow for this development, but two, for us to be able to make a live work, play community and for us to learn retail. So this is really our first retail development, and fast forward, we were putting together funding, figuring out, how do we get funding for this? We applied. We got a home Fund grant from the housing authority. Very small grant was like $900,000 you know, for almost $100 million development is less than 1% of our budget, but it got momentum. That's the key with with public funding, is like you just want to build momentum, because nobody wants to be the first to support your project. They want to be the second or third or fourth. So we got the momentum started. Then Amazon announced their big fund, their $2 billion housing fund, and they were specifically targeting Nashville. This was huge. Everybody in the housing world was completely caught by surprise by this, myself included. But as soon as I saw it, I was like, Who do I know that knows somebody at Amazon? And so our mutual friend, Nancy van Reese is a council member, not for this project, but different district. But I knew that she knew somebody at Amazon. So I I asked her. I was like, Hey, I know, you know Michelle Brown, can you introduce me to Michelle Brown? I'd like to get coffee with her and talk about this fund. She's like, Yeah, of course. Email introduction leads to Coffee with Michelle. We build a relationship. And as soon as they open the portal, I applied with Stonebridge, and I think they were still figuring out how to build the program when they opened it, and so I must have been on like 20 calls with Amazon's consultant. Basically, they were just asking me a bunch of questions about the market and how deals work, and you know, what goes on, and how does your underwriting work, and how does THDA work, the State agency, and all these different things. And I was, I kept educating them. I was like, All right, are we, are we going to do a deal here, or where am I just going to educate? And eventually it got to a point. We got our loi, and that's when I knew. I was like, All right, we have Amazon, like the biggest company in the world, backing this project, like, we are going to get this thing closed. And another, maybe it was another nine months going through. Really, what happened after that? We. Got our tax credit award Amazon support really helped get that and ultimately where this was also the time where interest rates started to spike. Thankfully, we had an offer from a lender that was able to lock rate as soon as they gave us an LOI. So that also helped really cover this project. But we had a lot of twists and turns with this one. We had pricing going through the roof before we even got it under construction. Then when we were under construction, we had pricing go through the roof and delay the materials and and issues with some of our subs and but what I learned is really one, if you do good deals, meaning well funded deals and mission driven deals, and you make them really unique. The capital will line up for that, like Amazon lined up for we had German American bank, National Equity Fund, we had the Housing Authority, we had the State Housing Agency, like they all wanted to be a part of a mission driven project that helped a lot of families, and also it helps you overcome costly overruns down the line. If you have a well funded deal from the beginning and and you do a deal that makes financial sense, so you have to always start out with a deal that pencils and makes financial sense and is not, you know, a margin deal. You have to make deals that make it to the point where you can overcome because there always will be, as you know, there always is unknowns, and so you have to have contingency in your budget for those unknowns, or else you will be hit really hard, and you will be out of a job, and you will not be a developer for very long, because there's just so many, so many hiccups along the way, from financing, interest rates, construction of Iran's construction delays, and so we've had to overcome a lot of those on Stonebridge, but to see it where it is today. You know, we just had the grand opening, and we had the mayor there. We had Amazon, we had all of our financing partners, and we had a resident who is living in Stonebridge now, who, you know, she was sharing her story about how she was living in a market rate community, but just paying an exorbitant amount of her monthly income, and they kept raising her rent and and she was living in worse conditions than Stonebridge. And she's like, this is this is untenable. I can't stay here and just pay, you know, this exorbitant amount every month. And so she was able to apply and get into Stonebridge. She has three kids, two of them are in college, but one of them lives with her, but she now has a three bedroom apartment that she pays, I think it's like 1400 bucks a month for a brand new apartment with all the amenities of Stonebridge. And she was even able to parlay that into a job with our property management company, and now works with them. So it's just amazing to see. You know, that's one of 311 stories, but each resident has their own story, and it starts with a nice place to call home, that people feel proud of, and then have the amenities and support wrapped around

Tyler Cauble 32:56

it. That's pretty amazing. How do you balance the mission and the margin, though? I mean, with all of the market volatility. I mean, these projects don't happen overnight, right? I mean, we're talking about probably four years in the making, give or take, from putting it under contract to actually delivering it, and you can imagine all the price fluctuations in the meantime. I mean, how do you actually deliver a high quality place to live while making sure that it's also financially viable in today's economic environment?

Speaker 1 33:21

Yeah, that is the multi million dollar question. Yeah, it's been almost five years since we got the land under contract on Stonebridge. And I think that is the hardest part for any developer, but I think I think one, it starts with a good understanding of your numbers. You know, like we talked about, like numbers rule everything. Your pro forma, your Excel model, rules everything. And so what you put into that really matters. And so we work with data from our previous deals. We also work with data that we get from our GC and our financing partners. We're constantly staying up to date on, hey, what does stuff cost to build today. Or, hey, this site's got a lot of topography, or a lot of it's very hilly. Like, how are we going to deal with that from a site cost perspective? So before we even get into a site, we have a good rule of thumb of what things will cost for us on the construction side. So that's controlling that unknown as much as we can. And then we go into the finance side. You can't really control interest rates, unfortunately, I wish we could, but you can control who you partner with on the finance side, on the equity side, there is some more, you know, I guess negotiation there. But ultimately, we want to align ourselves with partners who we know can be flexible with us or work with us when things get a little crazy, or when there's a bunch of unknowns flying around. So I think controlling the controllables is the most important thing on the finance side and on the construction side, and even before all of that, it's the site selection side. Like you know you make. Your money when you buy your land. It's same thing, like, there's a little bit more to it in development, because you also got to make your money on the construction side and make your money on the finance side. But if you don't start with a good price on your land or a piece of dirt that you can develop relatively affordably, I mean, that's something we always have to take into account. It's like, okay, this piece of land is a million dollars, but site work is going to be 10 million so really, that piece of land costs us $11 million like, let's not just be, you know, rush to the shiny object of, you know, a cheap piece of land. So we always keep that in the back of our mind. Of, like, we're sometimes willing to pay more for a flat site than we are for a super hilly site.

Tyler Cauble 35:37

Evan, you don't get half a billion dollars of real estate developed without some hard lessons learned along the way. What was your What was your biggest mistake made in development, and how did it really change the way that you approach your projects?

Unknown Speaker 35:52

Yeah, there have been many, many lessons. Yeah, how much time do we have?

Speaker 1 35:59

No, I think the the biggest lesson that I've taken away is be be very selective about who you surround yourself with, not only from your your team, your development team, but also your partners. Your partners should have the same core values as you. They should have the same mission as you, and they you should generally be thinking similarly. You want difference of opinions, in some ways, but in terms of core values, you have to be very aligned, because any development is like, it's almost like a marriage, and in some ways, affordable housing. I mean, we are committed to affordable you know, sometimes 1530 sometimes 99 years, and I don't want to enter into a partnership with somebody for that 1530, year period, if I don't know that we're going to be mostly aligned on most any issue that is inevitably going to come up down the line. And so that's a painful lesson I've had to learn multiple times where we, you know, quickly, go into a partnership because of an exciting opportunity, and then we realize, once we're getting closer to the closing table, we're like, wait a second, you know, I think they're trying to screw us. I thought we were partners. Like, how did this become where they want to, you know, take equity from us, or take ownership from us, or, you know, take something off the table from us. Or maybe they're just not aligned in terms of, like, how they want to treat residents or help residents like that's really important to us. So if we if we're partnering with somebody and they just are only concerned about money, then that's not the partner for us. We want somebody that want, yeah, wants to make a profit at the end of the day, but also really cares about impact and helping people. And so I've unfortunately learned that lesson more than I want to. Hopefully I'm done learning that lesson. But, yeah, I think that's been the biggest one. Is your team around you is really important, and your partners

Tyler Cauble 37:49

did you? Did you have a capital partner trying to Retrade the deal at the closing table, basically, we

Speaker 1 37:55

had a development partner. We were working on a land deal, and, yeah, I was basically like, right before closing, trying to renegotiate our splits that had been, you know, pre negotiated for the last 12 months. So,

Tyler Cauble 38:09

yeah, I've had that happened to me too. Unfortunately. Yeah, it's, it's, it's not entirely uncommon. I have decided I will never be that guy. Yeah, I don't like to Retrade. You know, there's, there's, there are people in this game that that is their entire Mo, yeah, they will Retrade at the closing table every time. And I would rather tank a deal than accept that, because I would rather not go into a deal with somebody that's willing to do that. Yeah, because if you're willing to do that, we shouldn't be partners. Exactly. That's not a way to do business. Yep. Well, Evan, thanks for coming on and sharing your lessons learned here with us today. For anybody that's listening that wants to follow along, learn more about affordable housing, where can they find

Speaker 1 38:49

you? Yeah, on Instagram or YouTube. Just Evan, holiday or our website is holiday

Tyler Cauble 38:54

ventures.com we'll leave those those links in the show notes. Evan, thanks

Speaker 2 38:57

for joining us. Man, Yeah, appreciate it. Man, you