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The Real Estate Addicts (REA) podcast is a must-listen for anyone interested in real estate development, investment, construction and entrepreneurship. Each episode dives into a wide range of industry topics and features conversations with savvy, successful entrepreneurs who candidly share their career paths, challenges, breakthroughs, and the stories behind the remarkable companies they’ve built. Expect big personalities, thoughtful insights, and conversations that both educate and inspire.
Co-hosted by Ray Hurteau, Dan Rubin (Instagram: @rhinvestgroup), and Marc Savatsky (Instagram: @choose_boston)
Follow the Real Estate Addicts Podcast on YouTube: @RealEstateAddicts
00:00
Yep. All right. We're back everybody. We are back recording. don't know if this is good for the algorithm. Welcome to the real estate addicts podcast. is it? Asking if we're recording. Oh, why? I don't They'll go. Let's start again. Welcome to real estate addicts podcast. This is episode something with your host Marc Savatsky choose Boston. Ray Hurteau, RH investment group. Dan Rubin, RH investment group. And to start oh chatting, multi-family breaking news. Multi-family minute.
00:29
Yeah, a multifamily minute update based on a couple episodes ago. Rent control in Massachusetts is dead. For now. It didn't get to the ballot. It was disqualified on a technicality related to religion. So there was an exemption included for religious institutions who would not have had to comply with that ballot measure. They would be excluded.
00:56
was kind of a fatal flaw. And it was a fatal flaw even though the attorney general certified on the ballot that it seemed fine in her opinion. So, Campbell probably is not very popular at the moment with a lot of tenant advocacy groups for a I don't know. I I think she tried her best to get it to go through. So, did she? I think she has the ability to tweak the wording from what is proposed. So, she certified it, but then who challenged it in the courts?
01:24
In the courts, was, you guys tell me, was, I forget who actually did the It was a coalition of probably developers, landlords, someone to that effect? Yeah, it was essentially challenged, right? And then they made it all the way to Supreme Judicial Court. And it was unanimous. It was a 7-0. It's not like it was split any particular party line or anything along those facts. But essentially, if it had
01:53
a religious exemption in order to know whether or not that institution was religious enough or had religious functions. They would have had to go and dive into it they're like, nope, we're not going to do that. I think it goes all the way back to 1917, the constitutional convention, religious fights were kept out of state politics entirely. So the measure is safe until 2028. The ballot measure is dead. It would have to be reintroduced in 2028.
02:23
And they had to get all new signatures and basically start over. Don't quote me on that. I didn't get that level of detail, but basically just assume what happened in the past will happen again. And maybe based on this kind of false start, there might be a little more rational thought put into the regulation rather than it being one of the strictest in the nation. um The only thing I can compare it to is we're going to have a couple of years of data seeing how the rent freeze in New York goes for the regulated units. That just passed.
02:53
So now all rent regulated apartments are no rent increases for two years and operators are already screaming, get ready for lots of issues. And I don't blame them. mean, can't freeze the expenses. they froze the already affordable deed restricted units or are they just, what did they, any rent regulated apartment. And I don't know the mechanism. section eight. I don't know the mechanism for which they do that. don't believe it's section eight. I believe it's probably similar to our deed.
03:22
Restricted apartments. This is thanks to our friend. We're like am I yeah, what's that? This is the mayor of New York. Yes, communist mayor of New York. Okay, and mom Donnie yes Socialist communists are all looking to take things well turn good update, right? Thank you guys for the yes Let me know when you want more of my ramblings and rants. Yeah What are we talking about today? We're gonna go into the silver tsunami hitting our workforce
03:48
which is a topic that's been discussed some trying to bring a new angle. And secondly, you know, college and is it worth it? So I should kick it to you guys. You're the ones with kids. Are you saving for college? I mean, we started a 529 plan for both kids uh before we wanted, or before we had kids, like just to kind of start saving. Wow.
04:14
The good news is I think now with the new 520, before 529 plans could only be used for educational purposes. And I think they've recently changed the rules and don't quote me because I'm not a CPA or a financial planner or whatever, but I think they changed the rules where now you can actually, if you don't use it for education, you can roll a certain amount every year into an IRA.
04:41
So it allows you to redirect those funds if your kid doesn't use it or doesn't resolve it or whatever. But I don't know, but from a trade standpoint, I would assume that's included as education so you can use your 529. Oh, trade school? Yeah. So you can use your 529 towards trade school if my kids wanna go to trade school. I mean, I've already talked to my wife about it and...
05:10
I mean, I would love my kids to go into the trades, but I think that kind of relates to what we're talking about, the Silver Tsunami, and like, what is the Silver Tsunami? So like just for reference for everybody, you know, according to the National Center for Construction, Education and Research, there's eight million, about eight million trades folk in the United States right now. By 2031, about 41 % of them are
05:41
supposedly gonna retire. So that's five years from now. Yeah. Almost half the workforce gone. So to keep up with the demand, there's gonna like as of today, so like it's interesting, the number of new trades people needed is like fluctuates based on kind of the current market. So I think a few years ago, I think, you know, when the market was hot, interest rates were low.
06:08
I think that the number was like over 400,000 and now they're saying as of today, to keep up with the fall off, you're gonna be able 350,000 new tradespeople entering the workforce to keep up with the demand. And I just don't, I mean, I know that there's been a push, but I don't think there's gonna be, I think there's gonna be a massive shortage. You know, it's interesting. I grew up, so I grew up in North Jersey and I grew up in a suburban town where
06:35
You didn't fix anything. If the light switch didn't turn the light on, like you just called someone, similar to your engine on your car. But when I was about a freshman in high school, my family ah moved we had a house in Western Connecticut and it's much more rural. And I made a lot of friends there. like, I sincerely credit them to this day with like changing my whole paradigm and how like I look at things and like my willingness to just like grab a tool and fumble around and watch a YouTube video.
07:05
And, um you know, so I was just showing you all my pest control. It's a destruction since I, my faith in our pest control company to get a pretty bad roach situation under control was diminished. And, you know, just starting to do your own research and find out what people do and why they do it. It's not that hard. Like most of the issues in the trades or trade related can be generally fixed on their own. And I think it also empowers people.
07:33
to know that they can fix some of the basic stuff. Like when you need an electrician, great, get an electrician. When you need a plumber, awesome. But if you're trying to do something, to fix something small, like I think everyone should know how to change a sink faucet. That's pretty complicated stuff for a lot of people, but it's really pretty simple based on how plumbing works today, as long as it's not like really outdated plumbing that requires like soldering. And the same with breakers and other things. You should know how to swap, you know, not swap a breaker, but you should know how to turn off and turn on a breaker.
08:03
or tell somebody, you know, help troubleshoot things a little bit. I don't know. mean, you know, it's all related. It's like, uh before I started task, I like to research it and think about all the things that I'm going to need. And I have it like fairly organized in my ADHD brain. So like the tools have this sequence. Um, and when I attack something like, like to finish it. Oh, you don't go and start like seven other things like I do. Yeah. Well, I mean, my biggest issue is that.
08:33
If something doesn't go to plan I find like I'm always trying to like force a circle in a square Whereby like I should just put my tools down and go to Home Depot and get the right tool But instead I'll just want to finish. No, I just wanted Jerry Ray. Yeah, Whether it's right. Yeah, yeah, but like we're talking college earlier and I guess my like hot take on college is If you're paying for college for your child because it's a great cultural experience and you want them to get out and see the world and really grow as an adult like
09:03
Props, I get it. That actually makes some sense. And if you're that fortunate, like golf clap, good for you. But send your kid to Europe for a year and fund that. Like, cool. I don't Be way less expensive. Yeah. I think that there is a tier of colleges that is still worth it. So an Ivy League school, a Harvard education, like, and primarily because of the network effect. I don't necessarily think that what you're gaining in the classroom is any more valuable than that mid-tier college.
09:30
But the credential on your resume and the network you make, make that investment worth it if you can get into that school. Short of that, like I went to Union College for a year in Schenectady. Union College is like pushing a hundred grand a year now. It's like, I don't get it. If you have a college and your resume and you have to tell everyone you meet, like where it is and a little bit about the school, like don't pay a hundred grand a year to go there. like Ray and I both went to Northeastern and Northeastern is creeping up to a hundred K here now with room and board.
10:00
It was like 30, 35 grand a year when we started. I think it ended in the 40s. Yeah, it hit 30 when we started. But I think Northeastern and those types of schools are becoming much more popular because of like the co-op type programs where you actually get real world experience and you're actually making some money. And when you do graduate, you actually have a resume with real world experience that sets you apart from other folks that are graduating with no experience.
10:30
So I think you're, you I don't know, is it justifiable to spend 100 grand for that? I don't know what it's worth, but I think you're seeing a lot of schools like Northeastern gain traction. Similarly, I think Ray, you said that there are more folks going into the trades or- I hear it anecdotally, right? So I'm hearing more people like, oh, I'm gonna think about being an electrician or I'm gonna do something with my hands because college, you know-
10:58
Here's the thing, hundred grand for college or whatever the number might be, that doesn't matter what major you choose or what direction you go in, terms of what kind of degree you're going to get. Maybe a doctorate is a little different, but if a Bachelor of Science is the outcome, right? And one person's getting a degree that has a really good job outlook, high demand, you know, will be worth the investment. And somebody else is like, I'm going to learn history.
11:25
because I like history or I'm not interested in other things. Like what can you get paid for a history degree, working at museum? I don't know. I mean, it's not unimportant, but is it worth the investment, right? Like what's the ROI on it? Just like when we're looking at a deal, what's the ROI on the deal? I don't think enough people are doing that math when they're looking for education. Roxbury Prep and I'm usually the voice in the room. Another thing you're always on. I also think that, especially, I don't know about today, but when we were growing up, I think that
11:57
going into the trades or going into the blue collar workforce was almost frowned upon. And it was like a almost, I feel that it was like a lower tier than the white collar corporate jobs. I don't know, I grew up in a similar town to you, Mark, where was like middle upper class. Yeah.
12:22
And you know, I don't know. I feel like the trades were almost looked down upon. 100%. My dad was a carpenter and I would be out there every summer working with him, hating it, saying I'm never gonna do anything with real estate. know, think attitude shift. And now here we are. Culture That's what I'm saying. to be the hippies in the 70s, the conservative, you know, keep everything in the 60s. Yeah. And like, I think we're in a shift right now. And I also think contributing to it is the fact that...
12:48
The trades is a technology platform now. Like if you wanna be a really good plumber running an efficient profitable company, you better have AI You gotta lean into technology. And yeah, and make it your friend rather than just like, you know, the guy crawling through the sewer pipe. in the, like to be fair, in the past, like a lot of the old school trades folk, they were inept when it came to technology. Yeah, correct. that, I think that again,
13:15
or just running- changing and needs to change going forward. Or just even running their business, right? Like I would do my dad's books. He had no idea how to use Excel. He had his checkbook register. He'd be reading me everything. I'm like, dad, do you know that you're- I mean, when we- You know, are you making money? Are you not making money? Like, do you know your finances? When we started in the business 16 years ago, there were guys that we were using that could barely text. Yeah. Yeah. It was like, I was mind-blown. I was like, Dan, why don't you put it all in writing? Like, right, they don't-
13:43
text, don't do video chat. text message, a picture to someone via text and like they wouldn't even know how to like look at it. I know it's tough. You know, I think another thing that I'll be like reflective about is, so I got into construction vis-a-vis a construction management degree at Purdue University and then went to work for Suffolk like a large, very well thought of general contractor. But my hot take here after having worked at a large, very well respected established
14:13
GC is that, uh you know, to their credit, they build buildings like uh Ford builds cars on an assembly line and you are responsible for this portion of the assembly line. You really don't see how the whole vehicle comes together. And that's because you are a cog in a wheel. You are interchangeable and you have to be to offer predictable results to the customers on these massive investments. No one person can know too much.
14:42
And so like, I'm very conflicted when I think about that first step in your career. Like, do you go to like a small home builder or do you take that job with Shama, Consigli, Suffolk, Turner? um know, there's not a lot of, like there's a limited number of those jobs. There's a limited number and they're great jobs because of the network effect, because of the resume. It's similar to that kind of Harvard. So like you can take that and go where you will or do what you want. But
15:12
I think going back to the argument, and I have some more data points here with going to college versus not, or getting an undergraduate degree versus going to the trade school. I think the other issue is that the median wage for college grads in 2024 was about 80K. The average wage for electrician plumber,
15:40
was 62K and the average pay for just a general carpenter out of school is only 46K. you're still, there's still a pretty big. Seems so low. Maybe we're in our bubble here. We are certainly. Those are guys who own the company either. the nation wide. I think a tangent to this is also side hustles like everyone.
16:08
uh Real estate cash flows as a developer look like mountain valley, mountain valley, mountain valley. And so like, how do you have something that can sort of even out those huge uh ups and downs? And I think one option, I'll rep circa demo and disposal here is to own a subcontracting business, be it a demo and disposal company, a plumbing company, an electrical company that's certainly tried and true. You know, they relate to each other. A lot of our best subs are now also.
16:38
know, developing properties, which is fantastic. And I think as some of these guys are aging and wanna retire and sell their businesses, there's gonna be opportunities to purchase these established businesses that are credible and that have, you know, some of the tools and people and knowledge in place um that someone like us or someone that wants to get into the trades can take advantage of. You know, I just. Yeah.
17:05
It will be an interesting, it will be interesting to see what happens over the next decade when it comes to this stuff. Maybe, maybe there'll be more trade consultants that aren't actively practicing, but we'll have to be able to help out because I think what we're seeing right now is a mix of white and blue collar in the trades. So you're seeing private equity buy a lot of these businesses, like you said, and are they adding value other than just making the process more technologically
17:33
available or pumping out of ad revenue. Well, that's what I'm saying. They're jacking up the prices, but what are you really getting for by that happening? You're not really getting workers who kind of understand it all. mean, if anything, it's like, we're booked four weeks out or you're just going to see lead times go crazy far down the road. And I think maybe that'll bring more people back in as independents. So I think I mentioned that on the prior episode. I don't know.
18:01
I think the trades are super important and to your wage discrepancy thing, you have to factor in if you're not paying a hundred thousand dollars a year for four years, you're now $400,000 ahead of that person who might have a 20 or $30,000 a year salary difference over you. That's fair. What's that payback period? That's very fair. On, you know, if you're taking out loans. Yeah. You know, I keep getting targeted in my algorithm for these like, uh, businesses that
18:31
kids slash young teenagers are making. And I saw a great one the other day, but it's like 13 year old kid in the Midwest who goes door to door and offers to clean all of your trash and recycling barrels for $10, not per barrels, just 10 bucks. And he's got all of his own little power washing equipment, a scrub brush. And like, I love it. You know, just the courage to hit their doorbell and answer the door and speak to somebody, whether you get the sale or not, that's so valuable. I was having breakfast with a friend this weekend in Connecticut.
19:01
whose nephew does a window cleaning business. He's got all the extension poles. uses the proper, you know, he told me Windex isn't good, it's streaky. They use Dawn dish soap. ah Take that for what you will. And another like business. you know, hopefully make a couple grand doing it, but really I just love that for like opening your eyes to sort of entrepreneurship and being a business owner. A lot of kids these days don't like interacting with other people.
19:29
Yeah. So I think just, just interacting with other people is huge in today's society. My good friend, Dre, his father passed away recently and she, uh her obituary was beautiful. She, she told this one story about her dad who owned a painting company. And when she was 11 years old, he made her business cards and she was uh vice president of paint prep and her job.
19:53
was to put the blue tape on the top of all the baseboards and the trim and the casing and sand. That's awesome. And I took it very seriously as an 11 year old. She had business. Like I think that's cool. I think that's very didactic. He's empowered him. Yeah. Yeah. You know, I just bought a book from, what's the guy from Parks and Rec? He's like, he's also a carpenter. The Bronson Swanson. Yeah. Nick Swartzen. it? His real name. Yeah. I bought his book. It's really cool. It's like 15 more than 15.
20:20
30 different projects you can build with your kid, your nephews in a wood shop with basic tools. And I'm planning to do a bunch this summer with my nephews. So I'll report back. That's very cool. Yeah, that is cool. What are some of them? One of them is like a slapper. So it's got these three fan blades kind of. And if you hit someone in the back or the butt, it's really loud, but it doesn't really hurt them. So that's one that stands out. Yeah.
20:49
Those are cool. Those are like age appropriate funny things. of them Some of them are cool. Very much, yeah. Awesome. Awesome. Well, I mean, I think that covers it. mean, again, it would be interesting to see what happens. you know, if I would love, if my daughters asked to go into the trades, would not stop them at all. 100%. Yeah, so. All right, thank you for listening, rating, reviewing, subscribing and watching. And we will catch you on the next episode.
21:18
Cheers. Thanks.