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In the Hidden Money podcast, you'll learn how you can legally use the tax code to your financial advantage. There’s wealth inside the tax code. Taxes aren’t the enemy.
Most people hate taxes (and pay more than they should). But when you view taxes only as an evil expense, you miss out on legal ways to grow your wealth. Unlock the secrets to saving tax and building wealth with the Hidden Money Podcast! 🎧💰 Hosted by Mike Pine and Kevin Schneider.
Kevin Schneider: This is honestly one
of the coolest syndicated deals that
I have come across in my career...
Once you peel back the details of
this and all the pieces that we had
to put together to get this done
the output for the investors is
gonna be absolutely tremendous, and
I've never seen anything like it.
Josh McCallen: So we paid much less than
half price, and they threw in 790 acres,
and they threw in a bunch of buildings.
Oh, and how about the number one ranked
brand of destination golf in Maryland too?
So all that came free, and we got
the golf course for half price
Mike Pine: So right now, for any
plain vanilla investor you got
50% of your first dollar of every
dollar invested back as depreciation
Kevin Schneider: You're
gonna receive tax-free income
Mike Pine: Tax-free income, baby
Kevin Schneider: Tax-free
income in this fund for at least
probably two to three years
Mike Pine: Well, somehow, Kevin,
we have been able to land the
busy, the famous, the infamous Josh
McCallen from Accountable Equity
on our podcast to interview him.
We couldn't get him in the studio 'cause
he's traveling and, and doing way too many
deals, um, saving so much money of, uh, on
taxes for his investors and our clients.
Um, but we got him here now, and
an amazing editing team that's
gonna throw this into our podcast.
Kevin Schneider: Yeah,
Josh, thanks for joining us.
We kinda teed up the episode already.
They know the, not the nuts and bolts
of your deals that you're putting
together right now, but they, the
general strategy of the purchase price
allocation we've walked them through.
And man, this is honestly one of
the coolest syndicated deals that
I have come across in my career,
and I'm not even helping you.
Mike's been taking the lead on it,
but I feel kinda jealous that I
didn't get to jump in there with
him at some point, 'cause it's
so exciting, and it's really...
The, when, once you p- peel back the
details of this and all the pieces
that h- we had to put together to get
this done, the output for the investors
is gonna be absolutely tremendous,
and I've never seen anything like it.
Mike Pine: Yeah, it was super exciting.
But before we get that,
that was a great teaser.
Before we get to this awesome, awesome win
and opportunity that Josh has, um, I wanna
just get into the background a little bit.
Uh, Kevin, you haven't had the, the
opportunity to work with him as much
as I have, but when I met Josh, he had
already, without Revos help, without
our help, he had a-- And he never
heard "Hidden Money" podcast 'cause
I don't think we'd started it yet.
He had already created a fund, a family
of funds called the Efficient Income Funds
that offered 100% bonus depreciation,
dollar for dollar for his investors.
And when he was telling me about this, I
was like, "How did you figure that out?"
I still don't know how you
figured that out, Josh.
But, and we'll get into that,
but then we realized we could
do so much more together.
Um, and y- you've done
five of those funds, right?
And returned capital, kept the
pref, performed above pro forma
Josh McCallen: yeah, the, the, you wanna
talk about e efficient income funds,
Mike Pine: Yeah, the Efficient
Josh McCallen: Yeah.
The efficient income funds,
you know, let, let...
I'll hit this one quick and then it'll,
it'll open a door to a backstory.
But efficient income fund was where, uh,
businesses like ours always use leases.
Uh, leases, um, two different
types of leases out there.
The one where the investors own
the equipment, um, and get the tax
benefit while they own the equipment.
That's the ones we went with.
They're called, uh, operating.
Yeah, operating leases
to me, the consumer.
So let's go back a second.
We own highly prof- high, high revenue,
high profit businesses within massive
real estate, and we've always seen that as
the power of unlocking the full tax code.
Yes, I've been to, when you and I met at
a great conference, you and I were vibing.
I had heard all the, you know,
the rich dad, poor dad type, type
of strategies of making sure you
benefit from the IRS tax code.
So I was a big believer.
That's why you and I vibe so
closely, is that I truly believe
the IRS tax code is written as a
roadmap to help grow businesses.
Therefore, the taxes shouldn't be
drawn out of the businesses because the
business itself is generating all kinds
of p- uh, tax generating activities
for the government, meaning employment.
You know, it's funny when people say
you don't pay any tax, and then they
look and I had 1,000 W-2s last year.
I think there were a lot of taxes
paid through, through the business.
But the enterprise value and the
in- the investors own our business
shouldn't have to pay the tax.
Why?
Because then they're gonna buy more of
these and start more of these and do
exactly what the IRS code wanted, which
is why we pass through the passive losses
Mike Pine: I, I, I'm sorry, I'm
gonna get on a soapbox just for one
second before we get more into this.
Kevin Schneider: Oh,
Mike Pine: enough fair tax.
Like you said, 1,000 employees in
multiple states who are all paying
tax, who are going to restaurants,
who are going on vacations, who are
buying things at the stores around
them, they are what grow the economy.
I'm sorry, I hate to get political,
but man, Domic in New York City,
you steal all that money from
them, who's gonna grow jobs?
Your grocery stores
ain't gonna do it, man.
So s-
Josh McCallen: because the money, the
money that an investor saves on tax
goes into the next business or real
estate project that grows the tax base.
And you know, it did dawn on me
this year, Michael, Mike, because,
uh, taxes on the cocktails we sell,
the wine bottles we sell, in some
states are as high as 9%, right?
So that, that is a pass-through, right?
I don't get to keep any of that money,
but I do collect it for the government.
I'm their tax collector.
We pull in 9% on beverages
in Maryland, sadly.
That's a lot of money.
And 6% on every- on everything else,
and same thing here in New Jersey.
All of those millions of dollars are going
to the government, so we're paying taxes.
Mike Pine: Yes, you are.
Josh McCallen: shouldn't have to pay
Mike Pine: And growing the
economy, and providing investors
cash flow and tax benefits.
So really quick before we get into
this awesome deal that we were able...
I w- it was a blessing to be
able to work on it with you.
Thank you so much.
Honestly, it was one of the most...
I told Kevin this, it was one of the
most exciting, fun, very technical
deals I've gotten to work on in my
entire career, and I want more of these.
But thank you, Josh.
So you're different than a lot of
syndicators out there because of
what your underlying businesses are.
Um, you have cracked the code on
hospitality, and I remember when
I met you, it was during COVID.
It was like, um, you said hospitality.
I'm like, "Oh man, you must be hurting."
And you're like, "Actually,
we're not that bad."
Um, it was right out, I mean, after the
shutdowns when the dam burst for you.
So tell us a little bit about hospitality,
how you do it differently and your
model, um, with the wedding venues.
Josh McCallen: Right.
So for, um, wow, so much I wanna share.
I know your show is focused on
the tax, so I'm gonna make sure
we try to always weave that in.
But we got to work for a family
office right after I came back
from Europe 20-some years ago.
And that family office, I grew
up in poverty, but I always
knew we'd, we'd build something.
So we had a nice experience
living in Europe.
I got all kinds of degrees.
I was, uh, helping run a university
campus in the Alps in a beautiful hotel.
We came back to America in the
boom days of the early 2000s, and
I wanted to get into real estate.
It was a dream my whole life.
So we worked for a year
to get into real estate.
We worked for a family office.
Now, here's what I learned from the
family office, is that they just
saw the world differently, right?
They had already had a big liquidity
moment, sold a big company,
and now they were using that
money to build other businesses.
And so I, you know, I think I had
a disproportionate, uh, access to
a lot of, uh, wonderful, you know,
conversations, wonderful deals and
investments that they were doing.
And during that, um, one of the challenges
was that great recession of '08 left us
with a few hotels, and those hotels were
never supposed to be hotels for him.
He wanted to flip them into
condo buildings and tear them
down and build gigantic towers.
Well, that was a great idea in 2006.
2005, that was a phenomenal idea.
And in 2008, that was a really hard
idea 'cause there was no real liquid...
There was almost no liquidity.
It felt like everything
was stopped for a while.
So he got stuck with these and,
and what I-- what we did is
we, we did not crack the code.
We just thought, "Hey, to get out
of them, we're upside down by 50%.
I mean, we overpaid in the bubble.
Now it's not worth what it was worth."
We came up with a business plan, came
into the world of four-star resorts
because we said they're beachfront,
they're, they're ugly and stinky.
They had that moldy smell
that old beach hotels have.
So I became a master at
renovating and restoration.
We built businesses.
Now, in those businesses, we stumbled
across a magical, uh, pivot in
my life, and that was weddings.
Now, at the beach resorts, weddings
were just a nice way to turn Northeast
America from a nine-week business,
nine weeks, that's it, to about a
15-week business, maybe 16 week.
Still ridiculous small.
But the weddings were very important.
So when we stumbled into the properties
that I now do for Viva May, where we b-
went off and learned how to raise capital,
everything had to change for me, Mike.
Yeah, we-- I'd fallen in love with the
ministry of hospitality, that if you
love on guests, it's rewarding to you
as the operators, you as the server.
It's, it's the whole epitome of self-
selfless love if you can change your
work into a gift of kindness and love.
So that was what inspired me
to kill myself, you know, to
kill myself working on this.
And Mike's watched me buy many of
these now, and he's like, "Man,
these are getting harder and harder."
But, um, so in 2018, I had to say, "What
would it take to attract investors?"
Now, weddings S were an, a happy
thing that I had learned, and they
were a bonus at my other properties.
But I actually did learn that if you
address the wedding business correctly,
then you're, what you're doing is
you're pre-leasing the building.
Now, that's a real
estate person's thinking.
So I had to like think like a real
estate person even though my heart
was in hospitality as a ministry.
And when I dove into what we
could do for people, I felt like
my fundraising became a ministry.
Here's what I mean.
In the family office, every deal was,
was, uh, going to be tax advantaged.
Every deal was gonna be multiple
benefits for every dollar spent.
But in the normal family, the middle
class family, maybe just accredited,
becoming accredited, maybe they're first
generation wealth builders, they do not
have access, typically, to strategies that
both invest for growth and maybe even for
income as well, and also offset taxes.
That is not a normal opportunity
for most families in America.
But I had already seen it, so of course
I got, you know, similar to you, I, I
met wonderful teachers like you, Mike, at
the time, and I realized, wait a second,
the actual benefit of the tax code is
it's, it's on purpose that the investors
shouldn't have to be taxed if you use the
code right, so that they buy the next one.
And boy, are we an example of that.
When I met you, I had one of these
resorts, probably had four...
200 staff in the year, and now we
have 1,000 staff a year and we have
seven resorts, about to be eight.
So all of that backstory is to say
tax and growth became like the way
I thought I could help investors.
And so it did color the way,
it, it colored the way we
looked at designing investments.
And by the time I met you, you put
it on, you put gasoline on that fire.
You've helped us help so many investors.
And the reason is, is an investment
has more than one benefit.
And, you know, over here, I'm over here
trying to make sure that I can touch,
help as many hearts feel loved, find n-
nourishment through, through hospitality.
We happen to be one of the biggest
wedding operations in the country.
We happen to look at that as a way to, to
ensure profitability for our investors.
So it's all kind of like
somewhat pragmatic, right?
Like, hey, in order to achieve our
dream, we have to take practical steps.
And now you're right.
I would say Accountable Equity, these,
these growing portfolio of, of funds
has, uh, it really has kept the idea
of designing for purposely so that our
investors get the best tax treatment.
Anyway, that brings us to the holy
grail, where we are today with, with you
Mike Pine: Yeah.
Not ready to go there just yet
though, because the tax benefits
are awesome and, and definitely the
main reason we have you on here.
But Kevin and I work with
clients all the time that are
making tax advantage investments
really just for the tax benefit.
Um, and they're willing to risk more
or not even get a future upside.
They're just buying down their
taxes or taking big risk, um,
maybe get an upside, maybe not.
Uh, and your business is different.
And I, I, I'm very biased.
I...
You're-- I'm your cl- you're my
client, and we get to do a lot
of work with you, but I've seen
you return investors' capital.
And the reason yours is different compared
to most of our syndicators is you're
not just buying an asset and figuring
out how to maximize revenue on it.
Buy a apartment complex, fix up
the property, and, and increase
rents and try to sell it.
You're buying and building a
cash flowing business with...
It is a secret sauce.
You've cracked the code on it.
Man, when my wife and I got to go
up to, uh, one of your properties,
Renault Winery, and we saw how...
It was like going to Disney World.
I had my first year at my first
internship at PricewaterhouseCoopers,
they brought all the interns down,
rented Disneyland for three days,
and they showed us how it all worked.
We got to go through
the underground tunnels.
Like, you could never see more than
one Mickey Mouse anywhere, right?
And I thought that was so
cool and such, so amazing.
You guys do the same
thing with your brides.
You'll have three weddings going
on at once, and your team's talking
to each other in, in the golf
carts, making sure not one bride
does never see another bride.
And, and that's...
it's, it's a secret sauce.
There's one more thing I wanna get to,
and then Kevin, have at it with the taxes.
You introduced me to this really
cool metric in hospitality and in
hotels, and it was earnings like...
I, I don't even remember
what it was called.
I want you to mention it, and if
you're willing to kinda throw out
how so different yours pla- your
operations are compared to others.
But it's the additional revenue per
dollar spent on a room at night.
Um, and your difference, y- the,
the Viva Mi properties, it, compared
to the standards, is incredible.
Can you talk about that?
Josh McCallen: times.
700 times.
So what he's describing, folks, if you
have actually ever looked at a real estate
investment or a hospitality type of real
estate investment, they'll often call
it RevPAR or revenue per available room.
And what they'll do is they'll take any...
This is anything from a Hampton
Inn to a Ritz Carlton to a
Viva May hospitality property.
They will take the annualized revenue of
the room, even though they know you didn't
rent it out 365 days, and they'll take the
total revenue room divided by 365, okay?
So that is as if you were sold out all
the time, what is your revenue per night?
And that nationally will come
in for like a three-star nice
property around $150 a night.
And if you multiply that out,
that's like 40,000 plus for a room,
and that's a really nice annual
room rent for a very small room.
If you're, if you're a multifamily
guy, that sounds really great, right?
Very small footprint to get 40 grand.
But We are in a category called
experiential hospitality.
Now, for those who are geeky on here
and that may have looked at investing in
hospitality or may have looked at want
some kind of alternative investment that
they actually can grasp, uh, you will--
if you start to kick the tires like I do
all the time on the internet, you will
see a lot of media right now around the
world word "experiential hospitality."
They say with AI, with everything, uh,
really all kinds of different reasons why
experiential hospitality is on the rise.
But this is when you can buy other
things at the property that you,
uh, choose to experience while
you're at a hospitality property.
That's basically the definition.
But most of the time it's
around wellness, which is great.
Uh, it's usually around unique
culinary experiences, unique other,
you know, learning experiences,
uh, immersive experiences.
Well, we do it in three ways.
We, we came here-- we came up with a
theory, drive to leisure is the most
endurable, most durable type of, of
hospitality, more than anything, more
than corporate, more than anything.
And that proved out in h- in COVID.
They were the first businesses that
came back, everything like that.
Second, we believed that you've gotta--
if you really wanna make, um, y- y-
great returns for your investors, you
wanna go for three to four multimillion
dollar revenue businesses per property.
That is revolutionary.
A typical hotel business is one
multimillion dollar rev stream
and one tag-along rev stream.
So for revenue stream.
So for example, it's almost always
rooms are 80% to 95% of the prof-
revenue, revenue of the property, and
then if there is some type of food
and beverage outlet, it's the rest.
Mike Pine: УгÑ
Josh McCallen: a Hilton Garden Inn,
then that's 5% or 7% of total revenue.
So at our businesses...
Now, but here's what's interesting.
I'm sorry, geeking out.
The Hilton Garden Inn, the Hilton
Garden Inn is a great business to
buy, but it is 100% dependent on
the natural demand of that market,
Mike Pine: Yep
Josh McCallen: which means that market
is in demand because the FIFA World
Cup is coming, then you can charge
whatever the heck you wanna charge
'cause there's not enough rooms.
Mike Pine: ããã
Josh McCallen: get the beach season.
But guess what you don't get?
Anything other than the beach season.
You don't get anything other than that.
That's called natural demand.
What we learned from buying the hardest
possible type of properties first, is that
if we design a reven- a, a sales machine
that sells the fullness of, sells the
business, we can actually put a lot more
trust and guarantee on our performance.
Now, I've touched into 100 different
things there, but that is the
crux of experiential hospitality.
Either experiential hospitality is a
buzzword, and it just means you can do
one or two hiking trails on a property,
or it's at the highest end of experiential
hospitality would be a casino.
Mike Pine: ãã
Josh McCallen: Water Park, okay?
Then those are, those are like maxed out.
Those have very high total
revpar, and that is the category
that measures between the room's
revpar and total revpar, tRevPar.
And if those, they can get into the
thousands, $1,000 per night per room.
But we're talking a casino
or a Kalahari water park.
Over here, the rest of the industry,
there is almost no difference
between total revpar and revpar.
It might go from $150 a
night to $160 a night, okay?
That's normal.
I Googled and tried to find the
most expansive total revpar that's
not a casino, and it was Gaylord.
Gaylord can get 2.5
of the m- do- I, I think it can
get, it can get 200% more revenue
outside of the room than in the room.
So that, that makes it a, a 300,
$400 a night to, to $500 a night.
That's what a Gaylord can get
because of the total revpar.
We just did the analysis for Forbes.
We were covered in Forbes because we
built one of the country's largest,
uh, luxury wedding businesses, because
we have a robust five luxury golf
courses now, because we have wineries
and other things we make money with.
Now we have luxury spa.
And because we do ticketed concerts and
events, our total revpar at our smallest,
our smallest total revpar is $803.
Our highest this year will be $1,100.
And we don't have a water park,
and we don't have a casino.
So what, what we've figured out is don't
look at them as rooms capacity assets.
Look at them as massive businesses,
and if you sell the demand, you can
charge more on the room rent as well.
So that is for those
really critical thinkers.
That's what that just was.
And sorry we went so deep, folks.
But
Mike Pine: the reason,
Josh McCallen: revpar is awesome
Mike Pine: yeah, the reason I
wanted to get to that is this
is not just a tax investment.
This is a great tax investment that
actually will cash flow, um, and
you have a history of doing so.
All right, Kevin, get into this tax stuff
Kevin Schneider: Yeah, no,
that's-- I'm already sold.
So what I on the tax side, we do have
to be careful though, 'cause as coming
in as a limited partner, which you
guys listening would be coming in as,
um, there's gonna be some caveats for
the deductibility of these losses.
Now, there's always ways, this is where
Mike and I come in, is there's ways to
make losses from a limited partnership
investment as a passive investor
become active against your W-2 and
against your trade or business income.
Does it take effort and work?
And yes, it does.
It takes intentionality and it takes some
proactive planning, but it can be done.
So you can invest passively
into a deal like Josh's and
maybe get active loss treatment.
But let's say you're not able to do
that 'cause it, the, the stars do
kinda have to align and you have to
have the facts set to back that up.
And we could get into that in another
episode, but it, it revolves around
real estate professional status, right?
So if you're, if we can't achieve
a, a real estate professional
status, you might be thinking,
"Well, what good are these losses?
I mean, ooh, I d- I, I have no other, I
have no passive income because if I'm a
high W-2 earner and if I passively invest
something, Josh's W- or K-1 coming to
me is not gonna offset my W-2, right?"
But here's the thing.
All this cash flow, this
new term that the w- TPAR.
I look at all, look at me go.
So with a TPAR like this, you're
gonna have income from this fund year
after year coming through on a K-1.
Now, these aren't guaranteed,
you know, there's always
risks in investments, right?
But if you're allocated a loss in that
first year, which in Josh's deal, which
he's about to walk through, is gonna be
a substantial depreciable loss coming
to all the limited partners, even
though it's not deductible that year
against your W-2, that loss is not lost.
It carries forward into the next year.
So guess what?
Now, when Josh starts kicking off return,
those losses are gonna come alive, and
they're gonna offset all of that income.
So you're gonna receive tax-free income,
Mike Pine: Tax-free income, baby
Kevin Schneider: tax-free income
in this fund for at least probably
two to three years, unless he
just kills, kills the income and
he just wipes away all, you know.
So it's a tremendous tax asset
to have passive losses, but a lot
of times Mike and I focus on the
active tax loss 'cause that's, "Hey,
I'm getting tax savings today."
But there is still so much
value in passive losses.
Mike Pine: And for non-real estate
professionals, non-hospitality
professionals, there are ways,
um, if, if you really need active
losses that this, that Josh would
be willing to talk to y'all and
work with you to make it active too.
Um, we've, we've run through
a whole bunch of ideas.
But let's talk about
this opportunity, Josh.
In a nutshell, I, I-- We, we can
cover most of the tax, but just,
yeah, give us, give us a nutshell of
this amazing opportunity that Kevin's
Kevin Schneider: Where do you start?
Yeah.
Josh McCallen: I, I'll tell you what,
I'm listening to this show and I'm
thinking to myself, if, if they're on
the other side of this, they're like,
"What the hell are we even talking about?
What property is it?"
So we, what we found, what we found is,
um, you know, doing the right thing is, is
attracting good leads of new businesses.
So we, we have been in the
Annapolis market as a resort
operator now since COVID, actually.
And yes, we have wonderful, uh,
waterfront resorts down there that do
different things, including hotel f-
of course, corporate and, and wedding.
And one of the guests, this actually...
Think about this, this beautiful flywheel.
Some of the guests have come and
actually reached out to us and
asked us to buy their properties.
So that actually happened over the course
of the last year, um, with a treasure.
And the treasure was anybody
who is in Washington, D.C.
right now or Annapolis, they will know
the asset called Queenstown Harbour Golf.
It is a 790 acre destination resort
golf asset that has been slowly,
lovingly being built since the
1970s when the family who-- We
bought it from the original family.
They bought a histo-historic
farm called Queenstown.
Queenstown, um, actually the name of
the farm was older than that, but...
So when we bought it, we were buying from
the original builders and owners, so I
think we got a great basis on it anyway.
But, um, they brought it to us
because they knew we would steward it.
Now, w- what is it?
It's 790 acres.
That property has two fantastic luxury
championship length golf courses,
and they also owned a property
in the Annapolis market, so not
on the Eastern Shore of Maryland.
I know this is a national
show, so you may not know this.
But I think everybody knows
Annapolis is a coastal...
It's where the Navy, uh, the,
the Naval, Naval Academy is.
Yeah, so Naval Academy.
So that, this is a very coastal area,
and it's very close to Washington, D.C.
These properties are all within 40
to 55 minutes from Washington, D.C.
So these are easy drive to from massive
wealth, and that's what we're buying.
So we have basically two different
locations, one in Annapolis market,
one on the Eastern Shore, right
over the bridge past Annapolis.
Total aggregate lance- land val- uh,
uh, scale is over nine- 900 acres.
And, uh, we bought 51, 54 golf
holes, and we paid, uh, $25
million for the whole package.
Now, right there, what's was
curious to me is two things.
One, people have probably never
thought about buying golf resorts.
I did not realize this, but because of
inflation, because of infrastructure
costs, a to-- If you and I wanna go
fix up a golf course today and buy one
that needs a lot of renovations, we
will need to budget $1 million to $1.5
million per hole
Mike Pine: Ouch.
Josh McCallen: to make a nice course.
Mike Pine: That's why I don't play golf
Josh McCallen: So, so that's how
expensive it is to build a course hole.
P- so with that, we got 54
of those for 25 million.
So we paid much less than half price,
and they threw in 790 acres, and
they threw in a bunch of buildings.
Oh, and how about the number one ranked
brand of destination golf in Maryland too?
So all that came free, and we got
the golf course for half price
Mike Pine: Yes.
And here's where it
even gets more exciting.
So like you said, the, the people selling
it, they'd had this place forever.
They put a lot of in money into it.
And here I learned, I don't know
if we've talked about golf on our
show before, Kevin, but I hate it.
I c- I suck at it.
I tried it.
I was assigned to do it.
It makes no sense to me, hitting that
little ball with that little club, and
every 100 shots you're getting it to go
where you want it to go, and the other
99 just being frustrated as all heck.
Um, I will play golf if I'm allowed to use
my shotgun to shoot the ball that you hit.
Otherwise, I'm out of it.
I d- and I know nothing about it.
But what I learned digging into this
when I started talking to Josh's team
about this, this purchase they were
gonna do, I learned how much stuff goes
underground to build those courses.
It's not like...
It blew my mind.
It's not just grass and sprinklers.
There's raised turf.
There's, uh, there's so much stuff.
These bunkers, oh my gosh,
the drainage in the bunkers.
You just see the sand.
I just thought it was a sand pit.
There's so much stuff there that the IRS
says, "Hey, that's all 100% depreciation.
Um, that's all allowable."
And we were able to work with these
sellers, and you were acquired.
Here's a trade or business.
Buying a trade or business to operate as a
trade or business, IRC 1060 says you have
to do a purchase price allocation or, um,
w- we might come in and do it for you.
So the, we worked on it.
We decided what are the
reasons, uh, Accountable
Equity is buying this property?
Why are they paying all
this money for this course?
Looking at their business plan, it
wasn't to just be a golf operation.
No, it was to buy an existing and
good golf operation, but to grow
it into being a V- Viva Mae brand.
And that allowed us to allocate a
ridiculous amount of their purchase
price to these depreciable assets,
um, which gives Josh and Accountable
Equity the ability to give how much?
I mean, a lot of depreciation
to their investors
Josh McCallen: Right.
So, I mean, the secret sauce here,
um, Mike, you're absolutely right.
What a, what a amazing program
we all put together here.
So th- we buy golf courses.
We'll buy golf courses, wineries.
Why?
'Cause they're rich, rich experiences.
They also attract a lot of tourism.
And then we overlay the hospitality
piece, which is restaurants, other
activations, and of course, our being
one of the biggest wedding operations in
the country, we overlay massive weddings.
But did I, did I forget to tell
the people that there's five miles
of waterfront on this property?
It's crazy.
It's like a peninsula.
So we got five miles of
waterfront for free too.
Don't worry about that, folks.
Oh, and a 45-acre hotel resort,
land entitlement provable.
Uh, they got that for free too.
So, um, y- you know what?
This is the secret sauce
of my business in general.
It looks a lot like real estate.
I mean, today our little portfolio
is 1,900 acres of beautiful real
estate, but it, it also functions,
um, with a lot of equipment.
So, I mean, I don't know.
It's almost like a manufacturing
biz in a sense, right?
So what, what's great about equipment is
the government has wisely incentivized
the consumption of new equipment, and
then you and I, the better the equipment
we buy, this is just philosophically,
the better the equipment we buy, the less
man-hours we need to execute quality.
So it, it's all kind of working
in our favor right now, Mike.
The IRS code's working to support
businesses like us to keep reinvesting.
We are helping investors take
all those benefits from us.
Um, this is just the beginning
of, uh, working with you on this.
Mike Pine: And this specific property
has some of the most amazing pre-built,
relatively new pr- golf holes.
Again, I don't know this, but I'm told
by all my friends that love golf, wow,
they wanna play there, and that is
like high-tech stuff they have there.
Josh McCallen: And then we have
a Top-- like even a Topgolf.
But, you know, so Topgolf is a brand that
many of us have played, and, uh, it owns a
course pro- property, what do you call it?
Like one that you can license to
your country club or a golf course.
So they have Toptracer Golf
at this property, which means
it's a lot like a Topgolf.
The only thing that it doesn't have is
the five stories, you know what I mean?
So we have that too.
So even if you don't love golf and you
just wanna play golf ball hitting and, and
play Angry Birds, you can do that here too
Mike Pine: If they, if you can arrange
it for me to be allowed to go there
with my shotgun and shoot the balls
that the people hit, then I am there.
Kevin Schneider: How about you
get a w-- You, they got good
Josh McCallen: a good idea
Kevin Schneider: You know, you can
eat, drink, and watch me golf, and we
can, we can have a good time with Josh.
You know, we'll figure that out.
You'll like
Mike Pine: We'll work on it.
That's true.
I, I, I-- you've proven me wrong
on, uh, on putt-putt recently, so
it was more fun than I realized.
Um, okay, so here's the
opportunity that's just awesome.
We've heard about the asset.
Oh, let me also add the reason.
So again, you didn't buy this to operate
as a golf course, although it's a heck
of a golf course, and it's something that
Kevin already wants to go golfing on, and
hopefully, um, he gets to go without me.
But I'll hang out at the, the marina, man.
Um, you provide demand for
these places, not just for golf.
People aren't only going
there for golf now.
People are gonna be going there for
weddings 'cause you create that demand.
Um, you've proven it over
and over and over again.
So it's not just, "Hey, I'm
buying an operating golf course."
You go look and underwrite golf
courses out there, y- you know,
they're very cyclical because people
are only going there to play golf.
People here are gonna be
going to play wedding or going
to, to plan their weddings.
By the way, I had no idea how expensive
weddings are, and Kevin, let me just
say, thank God I have three sons.
I'm sorry with your two daughters.
Um, they're expensive.
But that's, that's a once
in a lifetime experience and
people are willing to pay that.
And look, look at...
Go over to Accountable Equities.
Where should people go if they
wanna just start looking at this
Josh McCallen: Yeah.
I mean, for one, I'll give out
my cell phone for God's sake.
I'd love to
Mike Pine: Don't do that.
I don't recommend that
Josh McCallen: No, but, um,
Accountable Equity is the, the
company that is all of us investors.
We come together as a, a group of
wonderful families, 480 of us now
have written checks and become
beneficiaries of these assets.
So Accountable Equity is where
we own the real estate and the
businesses, but Viva May is the brand.
It's the Auberge or the
Blackberry Farm or the Marriott.
So Viva May is the type of
hospitality functions that
we do, which is very robust.
A lot of different experiences, as
I, I joked about earlier, and, uh,
we, we do it for the sake of love.
So it's a beautiful brand we're building.
But, um, yeah, just
Mike Pine: at the track record though.
You go buy v- you go buy vineyards.
Boom, you create more demand
and now it's profitable.
And compare it to when
it was just a vineyard
Josh McCallen: I will say that about
your business too, or Evo, and all of us.
If we remember, no matter whether we're
the world's best, uh, CPA strategist
or not, if we remember, or even if
we're the world's best culinarians or
golf, if you can shift your mindset and
become a great sales operation, then
truly you can control your destiny.
Now, it, it requires that you design
product, meaning whether it be a wedding
venue or a marina waterfront experience.
It actually has to be aesthetically
right to the market and to what
the woman is willing to pay.
But if you then go out to sell it
with a rigorous process, you can
ensure your business plan as best
as anybody can ensure anything.
But it's not just luck, and I
think that's your point, Mike.
It's an, it's some strategic investments
upfront, the aesthetic and the
distribution of marketing, and then it is
a robust team, and it is rigorous sales.
And, and we, we pride ourselves on
being a sales company like that.
A good...
And we think that's the best part of it.
And when you sell-- Oh, by the way,
you forgot the, the punchline, folks.
This is why we were
doing well during COVID.
Mike joked about it.
A woman pays us 25% of the entire
experience 18 months before we have
to buy the, the chicken dinner.
Now, that is as if, I mean, I don't
even know what other business does that.
It's basically pre-selling
the entire building.
And then she'll pay us the other
50%, so a third, 25 plus 50 is 75%.
The 50% comes in six months before
I have to buy the steak, and then
the last little bit of money comes
in the weeks before the event.
So we are always in a cash position
on the, on the, on the, uh, contracts.
And they're not breakable, right?
I mean, once those checks are written,
it is, it is no- not breakable.
So-
Mike Pine: Boy, do I think,
uh, that he gave me three sons.
You know, we used to...
I used to complain a lot.
We really wanted a daughter, but
thank you, God, for those three sons
when I hear of those, stuff like
Josh McCallen: says no people joke that's
why we went in the wedding business.
Nah, yeah, whatever.
Mike Pine: let's talk about the tax stuff.
So this opportunity, good investment.
Um, do your own due diligence.
Talk to, talk to the people at
Accountable Equity and hear about
it, learn about it, look at their
track record at the other places.
But the tax.
So right now, for any f- any plain
vanilla investor, you got 50% of
your first dollar of every dollar
invested back as depreciation
Josh McCallen: Now we always try
to get to 30% every time year one.
This one we were able to guarantee now
we're at 50% of every dollar that comes
in if you take the, the package where,
you know, it's really good preference,
preference rates and zero splits to
sponsors until you're fully recapitalized.
That comes with 50%.
Mike and I are working for
those that have a legit need
for some depreciation right now.
We have surplus depreciation beyond the
50%, and we are designing a specialty
class for investors that have, you
know, sizable amounts of tax strategy,
tax needs, uh, for an even more
aggressive, hopefully up to 100%, uh,
passive depreciation for a special class
Mike Pine: Yeah, there's a lot of science
and technicalities that go into that,
but it is absolutely there and available.
And the cool thing is this is a
2026 operation, and if you invest
in 2026, you get that depreciation
to offset your 2026 taxable income.
Um, it won't-- The opportunity,
this opportunity won't exist,
um, if you wait too long.
Josh McCallen: Yeah, 'cause
we put it out to market.
We did a $15 million raise, and
we brought in 9 million so far.
So we own it.
We b- that, that was
the budget to acquire.
We acquired.
We just q- acquired it recently.
And now the projects begin that are
in the business plan, and so the raise
continues until, until it fills up
Mike Pine: Yeah.
So I, I love the tax opportunity here.
I love the cash flow opportunity.
I think it's an amazing investment,
and you're an amazing, amazing
person to be able to work with.
I love being part of y'all's family.
Um, if you have any questions, and if,
if what you heard is kind of interesting
but you need more depreciation or you
need to get an active depreciation
roll, there are ways to do that.
And for the right people, Josh,
we'll work with you to do that.
Um, man, I love it.
Is there anything I've
missed, Kevin or Josh?
Kevin Schneider: No, I think that's
one of the ben- benefits of kind of
an operator like you, Josh, is there's
some people out there trying to raise
hundreds of millions of dollars.
They're not gonna give
out their cell phone.
They're not gonna come up with
special pref's and series and,
and kind of options for people.
And I think that e- even your hospitality
in the money-raising portion is shown.
Like, a lot of syndicators are
just like, "This is my deal.
Take it or leave it."
You're like, "No, I wanna actually serve
people, and I wanna get their needs met.
If you have a need, let's
design something, and we'll
design a special class of stock.
Let's do it.
Anything's...
No, there's no bad idea."
And so even in just in the money-raisings,
I could tell you're set apart, um,
with even just that, this conversation.
Josh McCallen: No, that is, it's a hun-
and Mike, Mike and I actually are ready
for somebody who has a legit need.
We, we have a, we have some concepts
that we can offer to them that are
Kevin Schneider: Ja.
Mike Pine: Really cool concepts.
And stay tuned for that on a future
episode, and we'll talk about it.
But Josh, I know you're busy.
You, you got 1,000 employees to
make sure that you're covering
their payroll for, so more than
Josh McCallen: So true.
We got sales, sales, sales
Mike Pine: yes.
Kevin Schneider: Pay your payroll tax
Mike Pine: We'll let you get back to work.
Um, but man, thank you so much
for coming on, and thank you
so much for the opportunity of
being able to work with you.
You are an amazing partner to have
Josh McCallen: Well, thank God I
feel the same way about you guys.
Revvo, let's go
Kevin Schneider: right
Mike Pine: Let's revolutionize, baby