Episode 151: Building Wealth Beyond Words: Rick Gibson’s Self-Storage Investing Playbook

Rick Gibson (00:01):

I’d go home and my wife say, oh, did you talk to either of the boys today? I said, oh yeah, I talked to Dan three times and Nick too. She go, oh man, they don’t call their mother as much. And I said, well, we’re doing that.

Announcer (00:20):

This is the Self Storage Podcast where we share the knowledge and skills from the industry’s leading investors, developers, and operators to help you launch and grow your Self storage business. Your host, Scott Meyers, over the past 18 years has acquired, developed, converted and syndicated nearly 5 million square feet of Self storage nationwide with the help of his incredible team at Selfstorageinvesting.com, who has helped thousands of people achieve greatness in Self Storage.

Scott Meyers (00:55):

Hello everyone, and welcome to the Self Storage Podcast I your hosts Scott Meyers. And on this episode, I am meeting with Mr. Rick Gibson. Now Rick has been a member of our mastermind. He has been a part of our community for a while. We partnered on projects together and Rick has been on quite a journey. He’s been a part of our community for a little while and some pretty special things have happened in his life as a result of that. And so he’s at that place right now where truly you’ve reached financial freedom and you’ve kind of crossed over to a different place. Pat. Yeah, Rick has come to a place right now where you kind of crossed over into the place of a financial freedom and really being able to write your own schedule and do the things that you wanted to do. And so why don’t you share with Self Storage Nation just exactly what that looks like and how the journey’s been?

Rick Gibson (01:40):

Okay, so currently I’m a retired lawyer. I was a lawyer for 39 years on that. I started investing in real estate as a way to be in business with my two sons and we are still in business together. We started, a lot of people do reading books like Rich Dad, poor Dad, and that my boys were both good to average students but not great students. So they weren’t big readers, but the Kiyosaki series of books really kind of resonated with them. They both worked in corporate America for a year or two, decided they didn’t want to do that, so they wanted to get into real estate. So we started flipping houses, started acquiring houses, did some creative financing, fell into a mobile home park 10 years ago by a lady who wanted to retire. She financed it for us and became known as the mobile home park.

(02:36):

People continued to grow our real estate portfolio in an effort. When I first came to you, I wanted to diversify from basically the single family rentals and the mobile home parks into a different asset class and attended one of your three day events in that liked what I saw in that, well in the, we were up to about 15 mobile home parks, got approached by a real estate investment trust to buy ’em all. Basically we were located in St. Louis, 90 miles east to west, 30 miles north to south, and all in the same management system, accounting systems, everything. And we got 11 of our 15 parks got purchased in December of 2021. Good timing. In retrospect, timing could not have been better. We’re able to take that money, pay off a lot of our rental portfolio, became the bank on a few projects, including our largest storage facility and now today as well.

(03:50):

As a result of that, I retired as a lawyer. I would not have ever probably retired as a lawyer, but for real estate investing. But I was able to, and now I live off the money we get from our storage facilities and rental houses and see, I like that is, and so

Scott Meyers (04:16):

it’s, it’s been incredible to watch your journey. It’s been an honor to be able to partner with you on a project that is going on very well. But we talk a lot about this business and being a legacy business, even from the standpoint where we talk to sellers, they’re hurt and that they’re sad if their family doesn’t want to continue on with their legacy and continue on with the property. And so if they are going to sell, they want to make sure that they are essentially mirroring off their daughter to somebody who is worthy that is going to capture that vision that they had and maybe finish out some of their unfinished plans or their vision for it.

(04:54):

And we position ourselves to do so, to have that conversation, to edify them and say, you’ve done a fantastic job here and I see your vision. I would like to, it would be an honor for me to be able to take this facility, your portfolio up to the next level. And people always joke and they look at me sideways when I tell them this. And it is true. They’re not looking to take the highest offer always, but if we build that relationship with them, then we have an opportunity and we position ourselves to ward off any other competition. That’s just how serious relationship is in this business. And you can see the sadness in their eyes if their kids aren’t involved in the business. And so I’m sort of at that stage right now, my kids got a little bit of time, they’re carving their own path, which is obviously exactly what we want for them to give them the freedom and the opportunity to do so. And your kids, they didn’t follow in your path and I dunno if you wanted them to become lawyers or to be attorneys, but they followed you in real estate and now you get to do it together. That is everything. We want to be close to our kids, whether it’s in business or in proximity and doing life with them somehow some way. And you get to do both. You get to do business with them as well. What’s that?

Rick Gibson (06:00):

It’s unbelievable.

(06:04):

Exactly. You’re joking. Yeah. Both my boys have morphed into roles in our company and we would not be as big as we are right now or as big as we got without them. And we all had different roles worked out great in that we would have, and we still have weekly meetings on Wednesdays. When I was a full-time practicing lawyer on Wednesday mornings at 10 o’clock, my assistants knew not to make an appointment until afternoon because we would have our calls and that and we would talk about what are rehabs going on? What projects are we looking at? What should we offer on this property? How’s this rehab going? Whatever. And that, and when one of us would get frustrated, the other one would pick us up. And we’ve had a rule two out of three vote wins and that they’re in their mid thirties now, but back then they were in their mid twenties and intuitive on that before we had grandkids and before the boys came full time into real estate, I’d go home and my wife say, oh, did you talk to either the boys today?

(07:13):

I said, oh yeah, I talked to Dan three times and Nick too. She goes, oh man, they don’t call their mother as much. And I said, well, we’re dealing that we still do today. During the mastermind, things are coming up. I’m texting on, Hey, we got to do this and that. And they’re real responsive. They love it. To me, they were originally in a retirement plan because there’s people who built really nice real estate portfolios in different asset classes. And then like you mentioned, the kids are not interested in that. Our best purchase, our biggest storage facility over 650 units was because we were a family business. And the seller told me that and that, and you hit the nail on the head and it’s great. It’s great. We’ve gotten along great about it. Nobody’s afraid to speak up.

(08:12):

You’re very fantastic. I’m very, extremely, very blessed.

Scott Meyers (08:14):

And also the best partnerships we steer and we work with a lot of folks here in our mastermind and also in the academy. And there are many folks that are friends and they want to get into a partnership, but two people that are broke have no cash whose credit is shot, but have a desire for self storage, doesn’t make a good partnership. It’s the complimentary skillset sets that people bring to the table. And the fact is, you just mentioned that you have three distinct skill sets and so you lean on each other, you pick each other up, but then you have roles. So roles and partnerships, whether family or not, typically that’s when they fall apart is when somebody steps into somebody else’s lane or they only operate out of a marketing lane, or they’re both really good at developing, but nobody handles the marketing or as AC or the fine way.

(09:00):

Yeah, exactly. You have to have that. And so you’re very fortunate that you have those complimentary skill sets as well.

Rick Gibson (09:07):

Yeah, our very first LLCI did the operating agreement and I’ve done dozens and dozens of ’em through my legal career. And I put in the first paragraph, family comes first, and if there’s ever a dispute, we will sow everything and divide the money. And then that over 10 years ago, and I don’t even think my wife Missy knows this, but she was the one who would decide, I said that mom will decide. I know she’s got to decide with the boys over me. So I just had to convince one of them to be on.

Scott Meyers (09:39):

We don’t need to pay a mediator. We have one on staff that we all answer to answer to mom or your answer to why. I love it. That’s perfect.

(09:48):

Well, it’s been incredible to watch that journey and especially when, I’ll never forget Rick, the first time you stepped into our mastermind, and this was during Covid and we had an intimate setting and we were out in the woods and we got together, we were going to kind of reframe this and decide how we were going to move forward together as a mastermind in this community that we built. And I settled up next to you after the first day and I said, well, what do you think? And he said, I think I knew within the first 20 minutes that this is a group that I have to be a part of and this is what’s going to allow us to go forward. And since then we’ve seen that, and I’m not taking credit for that, but it speaks to the room and it speaks to the fact that, as you mentioned, the boys get involved and they’re engaged and you’re taking and sharing information and bringing that back.

(10:30):

So tell me what community has meant within self-storage. You’re changing asset classes, you’re getting in. What does that look like to get in a community, this community, and how has that helped

Rick Gibson (10:42):

My thought process when I specifically remember what you mentioned when we did that had that conversation was, okay, this is going to be a commitment, time and money, and there’s got to be return when you make an investment, you want to return. And I had a return ratio in mind and it is so far exceeded it. The people that I’ve met, they’re so smart. Any answer you any issue or question you have someone or multiple people in this room or in this mastermind know the answers to? We have invested in a number of the people in the Masterminds deal. It’s because I’ve gotten to know them. I trust them. I know when I did syndications for our mobile home parks, I was more worried about my friends and family money than I was worried about my own.

(11:35):

And that’s the way the people are in here, that nobody will want to let down anybody else in this group. We’ve partnered with a builder and it was on a new build. And when the construction was going slow at the start because it was two states away and there was a lot of rain, I wasn’t worried that this was a contractor telling me that because he was trying to finish up another project. This is your guy, this is our guy, and he’s going to be a partner moving. He is a partner with us moving forward in the ownership of this facility. And to have those relationships, it is priceless. It is priceless. And that’s why I’ve invested in their deals and we’ll continue to do so.

(12:20):

I don’t do the operations, but my youngest son Nick does. And when he has a question, I know he has called people and that been great. It’s been great. And the people that you have Scott and are incredibly helpful because if I don’t know the source of an answer, I can call four or five people in your organization who will bend over backwards to find me the person to talk to or get me an answer, Annette. And that’s great.

Scott Meyers (12:49):

Well, it’s good to hear. And again, that’s the reason selfishly why we built the mastermind in the beginning I built it because again, there’s usually not a threat of me being the smartest person in the room, but I know I didn’t have all the answers in the beginning. And as I grew and I scaled, your network is your net worth. And that is we needed to deepen our Rolodex, but at the same time I wanted to be in a room that I’m going through business life together with people that understand what we’re doing that have the same challenges that I can go to say, Hey, I’ve got a challenge in the business right now, or my hair’s on fire and I want to hear the experience of other people that have gone through it as well.

(13:25):

Not advice, but what did this look like on the front end when you went through this and what did it look like on the back end? And share some resources to help. And so we built a community that is all about community of social storage folks and capital and deal flow and then best business practices. And so it’s great to see now the end product of that. Now people that are growing and scaling, they can get the resources just like you mentioned. But now speaking for yourself, I mean you’re at that place now. You’ve got financial freedom that real estate has brought and that’s mobile home parks and storage and in a timeframe in which it was a little bit faster than you saw, but I don’t know if they were on your bucket list or not, but you’ve been able to acquire and loosen pretty cool things in terms of residence and your hobby.

(14:08):

Can you speak to some of those that you made happen?

Rick Gibson (14:11):

Yes. So my wife is a retired school teacher and we’re from St. Louis, so huge St. Louis Cardinal fans. My wife would get two personal days as a teacher a year for 28 straight years. She would take one personal day to go to Cardinal’s opening day and her principals knew it, the old school district knew it and that she could never go to spring training because of it. So she retires the first year, can’t go covid. Second year they have the lockout, the first week of spring training. So being in real estate went around and just, okay, I’m going to look at houses. We ended up finding a house down near Jupiter where the Cardinals do spring training and bought it completely furnished, just like moving in A-V-R-V-O and that has a pool, never had an ounce of desire to own a pool.

(14:57):

Absolutely love it now. So the majority of our time is spent in southern Florida. I either walk three or four miles a day, play golf or play pickleball, sometimes two of those events a day and travel. The masterminds are always in interesting places. And that when we had the mastermind earlier this year in Napa, we spent a couple of days in San Francisco, went to Yosemite when it was in Colorado, another national park down in Florida doing things like the shark diving and stuff like that and the events that go with it. So we kind of planned our travel around that. I got to go to Europe earlier this year on a World War II tour, 12 day World War II tour. If anybody saw the show Band of Brothers, it was actually called Amanda Brothers Tour. So it started in Armandy, ended at the Eagle’s Nest where Hitler’s layer like the show did.

(16:02):

But I guess the most unusual thing that I’ve done is I’ve invested in a couple of racehorses. The first one did pretty well, did not make money, but didn’t lose a lot. So we invested in a second one and the racehorse interest comes, honestly, there’s a picture of me from in black and white from 60 years ago with my grandfather. I was three years old in a winter circle, black and white picture. He liked it and he would take his grandkids and I was the oldest on Friday nights. So the second horse we’ve invested in is a two year old right now, has had two races. He’s won them both. We are finding out tomorrow if he’s going to the Breeder’s Cup, which are the world championships at Santa Anita and Los Angeles, and he will definitely be on the Kentucky Derby Trail. So I mean I can’t even imagine what that would be like but mean what it will be like, what it will be like.

(17:00):

Yeah, just to be on it and go there. And I like it. I’m not a big gambler, but it’s just fun to watch the horses and be part of it and the excitement and that. So yeah, that’s a hobby. Yeah, that’s a fun one.

Scott Meyers (17:16):

 Yeah, we are getting to that place. First of all, my hobby involves a different type of horsepower and I think I’m going to get a return on that soon. And my wife is well aware of it, but that’s what self storage has allowed us to do. Absolutely. Yeah, it really has. We get to do fun things. We get to enjoy our hobbies. We get just spend time with our families and our friends and that’s how you real estate, right? If you need storage rights, it works. Well, Rick, I appreciate the time. It’s great catching up at you as well and so much that we can talk about if you would share with Storage Nation, maybe if you could encapsulate the journey, give words of wisdom, not advice, but you’ve been through, you’ve seen a lot, you’ve been through multiple economic cycles in real estate and just in general and from what you’ve seen in your law practice as well for the folks out there and timely because we are in another cycle right now where interest rates are high and deals are tough to make a half a in pencil out, but you’ve been through, you see what happens on the other side.

(18:16):

So with all of that and the experience that you’ve had, what are some words of wisdom that you can share with Stories nation? The times that we’re in right now,

Rick Gibson (18:23):

be optimistic when others are fearful. I was on a call earlier today with a friend of mine and she is a real estate agent and her father are investors in some of our little projects and she reads the tales of Woe, the sky is falling. And that was my conversation is, Hey, be patient. We’re in a great place. We can get financing on anything we want to buy and the deals are going to come. They’re not ready yet because people still have the prices they could have gotten two years ago in their mind, but eventually those are going to come down and when they do, we’re going to be in a great position, be patient.

(19:11):

It’s easy for me to say be patient because where I’m at, but I 100% believe it. That’s part of the thing about the Mastermind is come to hear different perspectives from people when you and Scott Lewis do your talks in the morning before the mastermind, the state of the market, what you’re seeing on a bigger global scale than what I see in the Midwest or something, it all of that shapes your opinion in your outlook here and collectively. None of us are the smartest people to rope, but collectively it’s a darn smart room. It really is.

Scott Meyers (19:50):

And that’s the idea is we follow the Napoleon Hill format, if you will, in Woodrow the way he designed the Mastermind now many, many years ago. And that is the collective genius of the people that are in the room. And the sum total of all that gives us a different perspective.

(20:06):

And that is, we talk about this a lot. We talk about the greatest gift that we can give our kids is the gift of self-awareness to help them, expose them to as much as possible, send ’em off in the mission field, give ’em a gap year after they get out of high school so they can begin to form a different worldview of different things. Not a worldly view, but a worldview, and see how other people think and the way that they look at things before they decide, this is my path and the journey that I’m going to go on. And to a degree, that’s what we need here as well because we sit our little bubble no matter where we’re located and even no matter where we’re investing, we do things the same way. But then you hear the presenters and the folks and the speakers, the guest speakers that we have that come in, the economists are talking about the economy, the brokers that are talking about after interviewing and talking with hundreds of investors and hundreds of lenders, how deals are getting done.

(20:51):

It shapes how you approach and look at your own deals. And that’s why I built this again selfishly so that I can take a look at it because I at the same time get kind of stuck in my ways of thinking of things is so to be able to tap into and shorten, if you will, the learning curve on where we’re headed in the market right now, and to see what’s coming up, see a little further down the road that is truly, that’s how you win at this game.

Rick Gibson (21:15):

And isn’t it great? I’m older than you. You’re older than most of the people in the room to see some of these young guys in their thirties and what they’re doing and wish we had that knowledge when we were in our thirties. I mean, what an impressive group. We had a presentation today, a guy from Florida bought a place in Illinois, literally 12 miles from where I own four facilities. And it was a great deal. I have seen that facility and instead of being mad at him, I’m high fiving him. I know there’s a good owner 12 miles away. And that’s the corroborative nature of the people in this room. That’s the atmosphere you’ve created. And if there are bad apples, bad apples don’t want to hang around with good apples. That’s right. And they’ve worked themselves out. And that’s why I love being part of this group.

Scott Meyers (22:09):

This industry lends itself to sharing more than other asset classes and groups, masterminds that I think that you find out there. I think due to the nature of our businesses that are trade areas only five miles. And so we’re not drawing from it. And it’s very rare that we bump into each other so we don’t lock horns too much. And at those times we’ve seen this group behave very well and their bow, our partner, or you take this one, I’ll take the next one. And we’ve even heard a guys, if they’re getting a little closer coin flip, it’s yours or it’s ours and we will live the fed another day. But knowing the collaborative natures who just mentioned that there’s more business out there and that’s the way that works, and bad actors are not welcome here and yeah, they won’t stick around very long.

(22:49):

So the industry leans itself to that. And then the idea of growing this community is so that we can do that because as every investor gets in better in this room, the entire industry gets better. And operating from a place of integrity, sharing, collaborating, and partnering. We have a saying here as well that if you want to go fast, go alone. If you want to go far to go together, that’s an old African proverb. What we’ve witnessed, we’ve seen it real hand how that has played out. And that’s my story with my two sons. A hundred percent. Yep. So good. Well Rick, once again, great to be here with you back in this incredible environment. And so now we’re going to go out and play some, we’re going to gamble this some funny money here at this incredible resort and casino has some fantastic food. And then tomorrow, another day about sharing and running once again and building relationships. And I am for one, very thankful for the relationship that I have with you and that all you’ve done have meant for this group as well. Well, and thank you for putting this together. This is top notch, a hundred percent. So it’s been a great journey and it’s been a labor of love of ours and it continues to grow and can’t wait to see what this room is going to do. Yeah. All right. Thank you.

Rick Gibson (23:59):

Thank you, Scott.

Scott Meyers (24:00):

 My pleasure

Announcer (24:05):

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