24 Jan 2013
The Dirty 30: Team of two double their sweat equity
Adam Rich and Peter Lohmann of RL Partners bought their first property near Ohio State University. It was a small 2-bedroom, REO purchased single-family home that they renovated themselves. After putting in a considerable amount of sweat equity (or as Peter said, blood, sweat and tears equity!), they had their first tenants paying rent in no time.
Name: Adam Rich
Current Age: 28
Location: Columbus, Ohio
Started investing at: 24
Name: Peter Lohmann
Current Age: 27
Location: Columbus, Ohio
Started investing at: 23
How much real estate do you currently own?
ADAM RICH: We own 4 single-family homes with a total worth of $600K.
PETER LOHMANN: They are all located in Columbus, Ohio.
How did you get started in property investing? What inspired you to put your money in real estate at such a young age?
AR: I was inspired by the success I saw of those who listed their profession as “real estate”. That, and a long time interest in investing and home construction drew me to the industry.
PL: My business partner was really the one who turned me onto investing in real estate. Adam convinced me to go in with him on our first deal, and I had so much fun that I started looking for more.
I was lucky to graduate college with little debt and a great job, so I immediately started looking for areas where I could put my extra money with a great return. The stock market was really uncertain at the time, so real estate seemed like a natural choice. In Columbus, we have been somehow insulated from the downturn that started in 2007 and that influenced my decision. These past few years had been a fantastic time to buy.
Your generation seems to be redefining what it means to be successful. What does success look like to you?
AR: I define success as the ability to completely control my personal schedule and the ability to live on 100% passive income.
PL: Success is financial independence. A lot of people consider “a good job” to be financial success and stability, but to me it sounds more like a ball and chain. You could be dropped by your employers any day with no warning.
I like to diversify my income streams, and I’d like to get to the point where my family and I will never have to worry about money. Financial freedom is a big part of how I define success. If you’re not happy now, chances are money won’t change that.
I have no illusions about money bringing happiness.
What’s your best advice for someone wanting to start investing early? Do you have any investing mentors?
AR: A number of well-known investors have indirectly taught me, including Warren Buffett and the Trump family. I have also learned directly from a few local successful investors. My advice would be to decide how much money you can spare each month. Select an investment you like and can afford with your investing budget.
PL: My advice is to pay off your major debts, set aside some rainy-day money, and then start looking to invest the rest of your extra income. Jump in head first. Even if you fail, you will come out ahead and would have learned a few things.
I’ve gotten advice from a few folks here and there, but for the most part I consult with my business partner who I trust more than anyone. He comes from a structural engineering background and is extremely objective and methodical, whereas I like to shoot from the hip.
We make a good team.
What are your future investing goals? Can you share a little bit about your plans?
AR: In 2013, I want to acquire a multi-million dollar portfolio of residential property. We hope to grow into an REIT IPO size through providing real estate syndication services and our direct involvement in the property management business.
PL: We are opening a real estate brokerage on March 1st. We’ll be offering sales, property management, and real estate investing for all levels of knowledge. In conjunction with that, we are continuing to scale up our own investments, hoping to jump into multi-family homes this year.