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Paul Neal: Welcome to the entrepreneurial agent podcast today. Listeners I’m soak. Excited to introduce my great friend and superstar real estate agent, Mr. David Nigar. David’s got a, quite the, uh, extensive background in business ownership and entrepreneurialship. And he’s brought that now into the real estate world.

He’s [00:01:00] former Virginia business owner of the year. He’s built multiple businesses and has quite the story. And, uh, not only that a great friend, I’m excited about having this opportunity to. David welcome to the show today. 

David Nygaard: Hey, thanks so much, Paul. I love, uh, love being able to chat with you. We always have some good conversations, so, uh, I’m looking forward to, uh, answering some questions and just having that dialogue.

Paul Neal: Yeah. Yeah. Awesome. Awesome. So we’re gonna dig into your real estate venture and, and what’s going on there. I know you’ve got a lot of exciting things happening there, but before we do that, uh, I knew you’ve had kind of a, you know, we all have a little bit of a twisty road to get where we are now. Anyone who’s, uh, got a few grays in their hair, like you and I both do, um, highlights.

Yeah, yeah. Highlights. Right. Tell us a little bit about your experience, how you got to real estate and your sort of your business experience, cuz you have a very extensive background there. 

David Nygaard: Well, actually my first venture in real estate was when I was in high school. My parents, uh, got me hooked when we bought a small apartment complex at the ocean from gene beach.

And, uh, that got me [00:02:00] hooked into real estate investing. And, um, so I’ve always had kind of an interest there. We kept that apartment and I basically was the, uh, rental manager all through college and it helped me pay my way through college. That’s really how I started. I, uh, more recently got back into it.

Uh, just, uh, a friend of mine was a broker and they suggested, Hey, with your business background. This might be something that you’d really enjoy. I was, uh, on the Virginia city council briefly. And, uh, after I left that position, I, uh, was kind of looking for a second amount decline and had decided to just try my hand at real estate and getting back into that.

And that was a few years ago. And, and, um, prior to that, I ran a fairly decent size jewelry chain that I grew from the beginning to, um, seven stores. About 12 million a year with seven employees. And, um, so we were pretty busy with that. So I I’ve just kind of had a variety there. I taught entrepreneurship at, uh, Chowan university.

I was, uh, involved with the entrepreneurship program at [00:03:00] college, William, Mary, and Regent university. And so I’ve been involved in entrepreneurship and, you know, working with small business owners for a long time. 

Paul Neal: Wow. That’s quite a, quite a background. I, I had no idea about the, your first foray in real estate with your parents and the, uh, and the, the multi-unit property.

yeah. So that paid for your college, huh? My college. Absolutely. Yep. Wow. Wow. So that’s, uh, that’s a great experience. And did they sell that? Unit after college or what happened that we 

David Nygaard: sold it about a year after college. And I bought my first car with the proceeds, my portion proceeds. I had, um, gotten in small inheritance from my grandfather and my parents were investing and they offered me the opportunity to take a small percentage.

And so just to try to, I guess, just to teach me. About investing in real estate and, and so forth. And so that’s how I got involved. So I, I had maybe 5%, so we weren’t talking a lot of money, but, um, it gave me a lot of experience to kinda cut my teeth. 

Paul Neal: Wow. That is a great experience, uh, or early lessons on learning how to [00:04:00] operate, learning, how to collect a rent deal with issues from tenants and that sort of thing.

as the, as the young man and, uh, wow. That’s great. And so you’ve had the other businesses, so you built the built a jewelry business quite successfully. I know that, uh, I’ve actually, uh, Got some pieces from, or my wife has from you over the years and she totally enjoyed those and, uh, and loves them. So let me add one 

David Nygaard: more thing.

I also am a, uh, American society of appraiser member. And so I’m, I’m UAP qualified and an appraisal expert as well. So that has also served me pretty well in working with, um, some of my clients in, in terms of addressing, uh, just appraisal issues that we’ve. 

Paul Neal: So the, um, the appraisal experience and the Gemological world translates over into the real estate world.

Sure does. 

David Nygaard: Because we’re members of the same societies. We have to follow the same guidelines under the uniform standard professional appraisal practice. And, uh, just because I’m a, I’m a part of those societies and a part of that, [00:05:00] uh, require. I had a lot of commonality with the appraisers. In fact, we, you know, just recently on a project we were working, it was a commercial project and we were trying to come up with value.

And, um, I ended up putting together a, uh, income stream approach because they, they tell us that we’re supposed to have three approaches to value. And the income stream approach was the one that got us the highest value on this particular property. So, because I am familiar with that, I was able to put that together for the appraiser and, uh, help him along with, uh, you know, getting the end result 

Paul Neal: we wanted.

And the end result turned out in your favor, in your client’s favor, I’m assuming. Yeah, for sure. Yep. Yeah. Yeah. That’s really interesting. So your, your deep insight there, and I think you mentioned to me before, I believe that you’re, you’re, you’re a master gemologist, right? So, I mean, you really know the ins and outs when you go into something like that, 

David Nygaard: correct?

Paul Neal: Yeah. Wow, so, okay, so you, you, you mentioned a commercial transaction. So where is your area focus in the, in the real [00:06:00] estate space in terms of, uh, representing clients today? I I’d say 

David Nygaard: really my sweet spot is small business owners who are either looking for personal residents or commercial property that I can help them find the right property and, or, uh, negotiate or put together the.

You know that we need to put together, uh, to be able to make something make sense. And then of course they like personal residences and, um, so I’m able to help them, you know, with a house, either selling or buying, uh, usually starting their own house and buying a new one, or if they, they wanna rent it out, I help ’em out with that as well.

Paul Neal: Yeah. I, I find that most small business owners entrepreneurs that they, you know, they have extra cash, right? I mean, the business is generating cash. And so you wanna do something with the cash and obviously real, estate’s a great way to hedge, you know, for the future. As we both know. And you know, I know you and I have talked a lot about, and you’ve helped, uh, multiple clients achieve this idea of, Hey, I’m a business owner.

And a lot of business owners today don’t necessarily require a physical location. The world has [00:07:00] changed a little bit, but a lot still do, right? 

David Nygaard: Absolutely. Absolutely. From warehouses to, um, you know, if you’ve got a restaurant it’s better to own your building than renting it, working with an HVAC contractor right now, and he’s renting, uh, a small space and he would really do well to be able to purchase.

Purchase his own building. Yeah. Build wealth. 

Paul Neal: Yeah. What would you say some of the key benefits there are to actually, if you’re the, the entrepreneur to actually buy the space that you’re renting? Well, I think you have more 

David Nygaard: control over it. You’re gonna control your expenses over the long term instead of short term, you know, every, you know, when you’ve got a five year lease, they always hit you to go up, you know, big time on that sixth year, you wanna extend it.

Um, they usually require remodeling and things of that nature too. And so, you know, why not put your money into your own? And own the building and build wealth that way. So your business is generating cash flow, um, instead of paying rent, pay or mortgage and let your business [00:08:00] pay for that as if it were rent.

And then you’ve got two sources of, of wealth that you’re building at 

Paul Neal: the same time. Absolutely. I’m a huge advocate of that. And I have a friend, a client as well that bought her own building. She’s a, she’s in the, uh, medical space and she bought a building about 13 years ago. So she’s her practice has been paying on this building for that period of time where she, she paid it off recently.

Well, the other cool thing that’s happened, um, sort of, sort of simultaneously is, you know, how medical practices are being acquired by these larger medical groups. Right? So she was recently approached, she’s kind of looking eye in retirement a couple of years downstream and they, they, so they basically bought her out.

And so she got, she got that. She’s still working there for, for the last several years before she retires, but they rent the building from her that she owns. And so she’s got this amazing cash flow on a paid, you know, free and clear building that, you know, she can keep as long as she wants until they offer her some, some amount of money, some grievous amount of money I to that’s too good to turn [00:09:00] down.

Yeah, 

David Nygaard: she’s in the driver’s seat because if she doesn’t want to, if she wants to sell, she, she has a existing client. Uh, that’s that’s in that, that building. So that’s a guaranteed revenue stream, easy to finance for a buyer. You know, you’ve got somebody there and if they wanna buy it themselves, I mean, she’s in the driver’s seat because it’s really in their best interest to buy the building and not have to move and, and resell.

Anytime you move, you lose a good portion of your 

Paul Neal: business. So. Right. That’s huge. So I just think it’s an, it’s an amazing thing. And I know you recently helped, uh, you helped a client that, uh, he has small trucking business bought, bought a 

David Nygaard: warehouse. He sure did. He sure did. That was an interesting situation.

I was the selling agent and, um, When I got the property to market, I had talked to some different, you know, commercial dyes, and they were like, oh, you can never, you can never get this much money for this property. And I said, well, my seller needs to get this to get out of this property. So I, I kept the deal.

I didn’t farm it out to another [00:10:00] commercial guy. And so I’m gonna go ahead and keep it myself. And I started contacting friends of mine who are, uh, CPAs and attorneys in the area. I said, Hey, do you have any clients that might be interested in the warehouse? Well, sure enough, I had a hit and uh, they said, oh yeah, this particular fellow.

And, and, um, he had been preapproved with a local bank town bank and they wanted a 20% down five year, uh, variable. And, uh, bank covenants and they had only approved him for 1.2 million, which was well under what we were trying to sell this, this property for. So I said to the, I said to him and the other agent wasn’t particularly helpful.

So , I don’t think the other agent even showed up to show the building. I didn’t no kidding, kidding. And so I, uh, I asked the, the buyer, if I could help him put together a finding package for him. And, uh, so we were able to, and that’s kind of actually where you came in is we put together. Finance package form and got him approved at, at, uh, 1.6, uh, 10% down.

And I think it was 25 [00:11:00] year fixed, uh, with no bank governance, which is a huge plus for him, but with the banking, with the, you know, trucking company. So he was thrilled. The, uh, sellers were thrilled, everybody was thrilled. And, uh, it was a, it was able to, we were able to put together a really good deal for that particular.

Paul Neal: David, you know, that strikes close to home for me. And I know it does you too, because being an entrepreneur and a business owner, your entire life, and you’ve created these businesses, so you relate to these particular owners, right? There’s, there’s a lot going on, like you and I have both had experiences where, you know, we’re wondering where’s the money gonna come from payroll on Friday.

Right? We’ve had these experiences like, oh my gosh, you know, I don’t really wanna go into the office today because I’ve got these issues that I have to deal. And on the flip side, you’ve got these opportunities where man, you know, life’s going great. So you see it all on the entrepreneurial side, right?

You’re really 

David Nygaard: living. Yeah, we sure do. I think entrepreneurs kind have a different way of being wired. Mm-hmm that? I do. And one [00:12:00] thing I think that we are really good at is turning over rocks and, and seeing what’s underneath them, right. Those rocks often have a lot of opportunities and most people aren’t even curious about what’s underneath these rocks that we wander.

But, you know, most entrepreneurs are like, let’s do what we can do with this. What’s under here. What does this property look like? And so sometimes you just have to learn how to find the right, right property that way mm-hmm and make a deal come together. That, that wouldn’t normally wouldn’t normally work 

Paul Neal: well.

I mean, you did. And that specific case, as you’re talking about, I mean, you really. I mean, you were in the driver’s seat there and you, you weren’t representing the buyer. You were, you were first representing the seller. You were representing the seller and you were out there really trying to find those buyers, which would be a traditional buyer’s in a role, right.

A very active approach to solving the problem, getting the best yield. And so getting the best yield for your, for your seller, but also giving the buyer the best terms possible. So, so really at the end of that, [00:13:00] everybody walked away a winner. Absolutely. 

David Nygaard: And without being able to find the right financing at the right rates to make the deal make sense for the buyer, that’s where it really comes together because it turned a piece of property that was a failing supplier for Chinese food, for Asian food.

It was a food market and they had really lost a lot of business. And so they weren’t doing well. And we took that property and created a deal that’s gonna employ, you know, 30 40 people and, and then stop to actually bring jobs, you know, to the market. So this is where entrepreneurs really make a difference is we create deals that create jobs and improve our community 

Paul Neal: in that way.

The modern day turning the lead into gold, right? I mean, that’s what the entrepreneur does. And there’s so much to that we can unpack because there’s so much value. You know, we talk about, we live in a world today where it seems like everything [00:14:00] is me, me, me, me, me, you know, I call it MEO centric, right. The world revolves around me, my phone, my, my comfort, my convenience, and all.

But really to be successful. What you’re saying is, is you took the outward approach to like, Hey, let’s look at this scenario, this, this solution, this, this problem that’s been put in my lap, this opportunity, right? How can we solve this problem and benefit the most people so that when everyone walks away, it’s so much better.

So you literally are turning dirt into something special led into gold, you know, You feel good about that? Right? Absolutely. 

David Nygaard: And, you know, for instance, this, uh, the buyer in this particular case already had like a third of the, the, uh, warehouse already rented. So he, he was walking in with a positive cash flow to begin with and the people that had had the failing business, they were able to get out and become whole and not have this weight dragging on them.

And so it truly was win, win for, for each party. 

Paul Neal: Yeah. Yeah. [00:15:00] That’s, that’s awesome. That’s. You have told me that you’ve really recently been also digging into a really interesting kind of niche area, something around the idea of use of historical homes and the utilization of tax credits and things like that.

Talk to us about that a little bit. 

David Nygaard: There’s great opportunities in industrial properties or other properties that have been vacant. And, um, if they’re older than 50 years old, there may be federal and state tax credits available in some of these older buildings. And what the government does is they allow you a, basically a credit in order to refurbish or bring that, that building, you know, to stop.

And so you can find maybe a, a, a $10 million building. Maybe you, you put down 10%, you know, maybe you put down a million, right. And maybe you’ve got 3 million, $4 million in tax credits that you can sell readily to put back into that building, to maybe convert it to apartments, retail space, office space, you know, whatever you’re, you’re trying [00:16:00] to, you’re trying to do.

And um, if we can find those buildings, those are like great opportunities. You can maximize your return. By taking advantage of these credits. And the thing is, is that different states have different credits. Mm-hmm for instance, right now, North Carolina has a number of old textile mills that they are trying to do something with, and they’re in towns that are struggling economically.

And so those tech they’ve offered just the state has offered a 40% tax credit on a mill, been vacant for two years, for anybody who wants to buy it. And you know, these. Tax credits that can be real dollars that you can sell and flip that money. So you can own the property with, with essentially no money down.

You’re selling those tax credits immediately to recover the, the, the down payment. And you’ve got money to spare to, um, to refurbish the building. 

Paul Neal: Wow. Wow. That’s that’s fascinating. And, and so, so the tax credits are available to sell sort of on the secondary market. Mm-hmm certain buildings. Yep. 

David Nygaard: Yep. [00:17:00] And people are looking for these, all the.

Do 

Paul Neal: you do you and I go and I’m sure I’m sure it varies state by state, but, and even maybe locality by local county, but are there certain sort of restricted uses or requirements on the buildings when you take them over or no, 

David Nygaard: you wanna maintain, they want you to maintain the historic nature. They don’t want you to tear down, so maintain historic nature, but you can go in and get the entire inside and usually, you know, change it.

So a lot of ’em are being turned into apartment buildings, you know, multi, uh, family. And what’s nice about those is, uh, you know, even if it’s the first floor becomes something else, uh, the second, you know, whatever floors, uh, become apartments, those properties always have some kind of market value.

They’re always liquid. You can always sell those pretty readily in the market these days. Yeah. Uh, cause people, people wanna buy an institutional buyers want these apartments. And so, um, so it’s not a bad deal to get into, but if you can get into the right. Right. 

Paul Neal: [00:18:00] Right. So, and they’ve done that quite extensively in like the downtown Norfolk area, right?

Oh, absolutely. Yeah, for sure. Yeah. Yeah. Well, that’s fascinating. Absolutely. It’s just, just amazing how many opportunities are out there when you know which rocks to turn, right? 

David Nygaard: Yeah. Opportunities until you over the, you go what’s this. Yeah. . 

Paul Neal: So if I’m an entrepreneur and I have some money to invest and I’m looking for a building or whatnot, that I’m looking for, somebody that, that is very creative and that can turn over those rocks because that’s where the value is.

Right? Absolutely. I mean paying, paying list price for something that, you know, once the lipstick is on the pig, as they say, right. And it’s all dressed up, then there’s no benefit there. Right? Paying full retail is never a good, a good idea. No, 

David Nygaard: absolutely not. Although there is an argument to be made. I mean, I’ve got a friend of mine who’s, um, the beautiful business and, uh, the seller of the owners of his, his apartment or not apartment, but the, his, his building, aren’t all that excited to.

Right. So should [00:19:00] he, or should he not try to pay a premium on that, that property? I would say if you can afford to pay the premium on the property and you’re still making money with your business, I’d do it because you’re getting in on, you’re still getting on the escalator and it’s still going up. So for this particular individual, it’s a great piece of property.

And so in that case, I’d say, why not pay the premium if, if they really want the premium and it makes sense to your business, go ahead and do it. It doesn’t. You’re getting on an escalator, you’re going up, you’re already there as a business. Go ahead and approach the owner and, and let’s see what we can, we can do.

Paul Neal: Yeah, well, there’s a lot, there’s a lot of owners and you know, what do they call the silver wave that are getting to the point where they wanna punch out? We do a lot of business acquisition and we see that a lot, particularly after COVID they’re like, ah, I don’t really, at this point, want to dig in and, you know, potentially an economy it’s slowing that, you know, I don’t know if I wanna dig through that.

So I’m gonna sell. And, uh, I will say this, that from a financial standpoint, you know, business is much more [00:20:00] valuable if there’s real estate involved and it certainly opens up the financing options exponentially than if you’re just selling a business, you know, in good will and cash flow. 

David Nygaard: Oh, yeah. With a lease right.

Yeah. Those are hard. Those are hard businesses to sell. And, um, I’ve seen people trying to do those all the time. People approach me and they didn’t even have a lease. They were once 

Paul Neal: a month. yeah. It’s like I would sell my business for 8 million. Okay. 

David Nygaard: That. You know, right. So yeah, that, that becomes a challenge.

No, the real estate really does help if you’ve got the piece of real estate and your, your, your business operating in there, that’s a great sweet spot on many levels. And like I said, even if it’s, so can you find deals? Yeah. Yeah. Let’s go find a deal, uh, and you’ll move your business. Mm-hmm and have that expense.

So that, that does work, but it doesn’t always hurt to pay a premium on the property majority in majority occupying. If, if, uh, it makes 

Paul Neal: sense. Well, I have a [00:21:00] client right now. That’s doing exactly that. He has a restaurant here in town and he’s had the restaurant in that one location. He’s got multiple locations.

He’s been in this one building for about eight or nine years, had a fire in the kitchen. So about four years ago was able to renovate the kitchen. So he built a kitchen out exactly the way he wants it. And then out of the blue, the owner of the building approached him three or four months ago and said, Hey, we’re gonna sell the building and we’re gonna give you first ride a refusal.

And here’s the appraisal. Here’s what the building is worth. But I want more, I want more than that. And so my client. Agreed to his price, because the premium that he’s paying for this property to your point is well worth it for, for his business. He’s got the client base, they know where he is. He’s local in the neighborhood.

He’s got the kitchen exactly the way he wants it. The cost of moving the cost of, you know, putting together the new kitchen exactly the way wants it. And then perhaps the, you know, What percentage of clients is he [00:22:00] gonna lose by moving, you know, three miles down the road or 20% could be, yeah. 20%. So, so that cost is, is, you know, we don’t even know what that number’s gonna be.

Right. So at least with the premium, there’s a, there’s a known figure that he’s like, okay, I’ll, I’ll pay that price, which is in his mind in investment. Because again, he’s now got real estate. He’s positioned this business at maybe five or 10 years to sell it. And so at that point, you’ll have the business pay.

The, the building paid down substantially, if not paid off. But he, you know, he, he, he owns it. He can make these improvements, he can do what he wants and, uh, he doesn’t have to relocate. So, yeah. So it does make a lot of 

David Nygaard: sense. Yeah. It really. And a lot of people are in these buildings that the owners don’t necessarily wanna sell.

And so, but a lot of the owners don’t always know what the value true value they’re building is. So we can usually hit that property. If you approach ’em just the right way, you’ve gotta learn how to approach that. Owner that doesn’t know they wanna sell yet. You’ll approach them the right way. And um, if you’re their tenant and you wanna approach them [00:23:00] that doesn’t always work right.

It’s really better to have that third party come to them and say, Hey, I’ve got a potential buyer for your building. Like discuss it with you. And you know, they’ll say, oh, I’m not interested. And they’ll say, well, listen, everybody has a price. What makes sense for you to, to, to sell? Because you know, my, my, uh, buyer is very interested.

And so then you can begin. The makings of the deal, pull something together. 

Paul Neal: Yeah. Yeah. That’s a, that’s a great point. Yeah, that, that third party just separation hard to 

David Nygaard: do it on your own. If you’re, if you’re the tenant, it’s hard to do it. Your restaurant guy was lucky that the owner a wanted to sell and B a game first five refusal.

But because a lot of owners don’t wanna sell, they don’t have a huge incentive to sell unless you give it to them. And that, and that’s where that extra dollars extra dollars can come in. But like we said, it, it sometimes it’s really worth. 

Paul Neal: Yeah. Well, and I think it, it’s one of the things that I know that you, you add value too.

I’ve just, you know, working with you’ve known you for so many years is that I’ve seen it. And our mutual clients tell [00:24:00] me all the time, is that your ability to negotiate? I mean, you’ve been in a lot, you’ve been in a lot of places from, like you said, city council to, you know, expanding your own business to seven locations, uh, you know, negotiating on multimillion dollar lines of credit with banks and you know, all of that, you know, that skill.

I mean, you, you can take a class, you know, when you fly, they, they always promote that. But yeah, but a class and a book is not the same as actually having it. And, and to be able to do that, can, can really turn a deal from marginal, if not good, to, to exceptional it’s done well. Right. 

David Nygaard: Exactly. And it makes a win win on all sides because negotiating, I think still means to be a win.

Those are your best negotiations, but sometimes it’s just finding creative ways to do things. Um, and that’s where you, you sometimes just have to be creative. Sometimes there’s lease back, we’ll sell it, but we need to lease it back for a certain period of time or we’ll lease it with the, with the, you know, for [00:25:00] three months with the option to buy whatever, whatever needs to happen to bring there together.

But sometimes it involves zoning. Sometimes it involves, uh, There’s just a lot of things that can come into to making a deal. And one of the nice things is having been on council is working with zoning commissions and, and knowing who you need to talk to, to get at the local level. You know, sometimes, you know, uh, we were just talking the other day, I think, and that if you wanna do certain jet deals in Chesapeake, and there’s certain people that you need.

Talk to, and, and, you know, get their, get their approval and maybe get their involved with it. Yeah. So you just gotta know who that is and, and you know, how things work. Right. Um, so , so yeah, my little, my little foray into politics, and then the council definitely helped in that particular regard, 

Paul Neal: it all adds up, man.

It all adds up experience over time. And, uh, and you’ve had a lot of really awesome. So we’re coming on to the end here. I don’t wanna go past our 30 minutes. Tell our listeners how they can get up with you if they have, [00:26:00] you know, a thought on, Hey, I wanna buy building I’m mentioned in commercial real estate or Hey, maybe I’m, I’m an entrepreneur, a business owner.

I’m looking to acquire that next home or a home on the water. What, how do they get up with you? 

David Nygaard: Oh, well, my email is David David nigar.com, which I’m sure we’ll put into the, uh, comments here. Yeah. Uh, my phone number is (757) 333-4033. And uh, so call or right. You know, either way is great. My, uh, website is David IARD properties.

Uh, that’s more geared towards the residential. So that that would get you more towards residential side, but those are the three best ways, but probably I’d say the best way is gimme a call and let’s have a conversation you can’t really get very far until you can have that conversation. And, and sometimes just sitting over coffee, sitting like what we’re doing here and just saying, Hey, what are the, what, what let’s explore the options going from there.

soDavid@davidnigar.com is the email seven five seven three three three four three three. Is the phone. 

Paul Neal: That’s awesome, David. Yeah, we will definitely have that in the show notes. So, uh, it’ll be easy [00:27:00] to click and find and I would say absolutely. If you have a need or desire, definitely reach out to David.

He’s a great guy. You have a great time, great conversation. And more importantly, if there’s something there that, uh, makes sense for you, he can help you figure it out and put it together. So, David, thanks. Thanks for this time. Today’s been awesome. I’ve really enjoyed this. Thanks me too. Let’s do it again.

Okay. For sure. Okay, buddy. 

David Nygaard: Bye. Bye.

Thanks for listening to the entrepreneurial agent. If this episode really struck a chord with you, make sure to check out our show notes and contact us and our guests directly and let us know. You’ll find all our social handles here. Be sure to subscribe, to stay on the cutting edge of what’s working now, as you advance your real estate career far into the future.[00:28:00]