From Dan Peña – Executive Coach and Mentor to the High Performer.
Dear Friend and Subscriber,
I have enclosed an email received from one of my QLA devotees. I used the actual email as the format for my reply (in dark bold). Now that I am an internet man I can do such things! It may be hurtful to some! Whilst others will chant "Braveheart, Braveheart!" – That’s what makes the world different and exciting. I hope you enjoy reading about a long term struggle that ended in success. I have seen this young man through a lot of tough times!
I have replaced the various names with letters and initials to protect the innocent and guilty.
IT FINALLY CLOSED
M, I AM VERY PROUD OF YOU! I AM GOING TO USE THIS EXPERIENCE IN A NEWS LETTER W/O YOUR NAME. Dan,
After a very intense week, with many "sink or swim" moments……we closed yesterday. CONGRATULATIONS!! R&M & I signed loan documents and real estate closing documents in one of our lawyers conference rooms….Friday morning at 9am. JM came by to congratulate us, while the attorney he assigned to us actually facilitated the paperwork with the title company and lender out of Chicago. GIVE HIM MY VERY BEST AND SAY MANY THANKS! THANK GOD THEY HAVE BEEN ON SUCCESS FEE ALL THESE YEARS! IT’S GREAT TO GET THEM FINALLY PAID!
Our deal closed with an assigned value of $3.5M. Our lender, Investment & Loan, loaned A Apartment Company, LLC $2.2M. M Management is the Managing Member of the LLC owning 55%, with B owning 25% initially and having a "call option" on Steve’s 20%….for an eventual ownership position of 45% within 12 to 24 months. JM had another "specialist" attorney within the firm write an amended operating agreement that gives us the ability to "call" or take over Steve’s 20% …..without interfering with the lender documents.
The lender set aside $200K of the loan proceeds as capital improvement funds for the property. As we make the capital improvements and improve the cash flow…..our lender is willing to convert our bridge loan into a 4 year "mini-perm" and is willing to lend additional funds depending on the performance of the property. We’re predicting to be able to make the conversion within 6 to 12 months. And within another 6 to 12 months…..refinance into a permanent loan with a large equity payout. SOUNDS GOOD!
Our investment bankers said it this was one of the "wackiest" deals they’ve ever done and the lender had similar comments! However, we now have our first deal done!!! And M Management owns 55% of a $3.5M property….with us effectively set up to own 45%….having put in no money! I KNEW YOU WOULD DO IT! I will begin collecting a salary and housing allowance as of Monday from the property.. THANK GOD!.. and as the property’s cash flow improves we will begin collecting an asset management fee.
My wife has been out of town in Wyoming at a family wedding….so I closed this deal alone basically. I KNEW YOU COULD! (I’ve been drinking red wine out of one of my "Guthrie Castle Wine Glasses" that I rec’d from you while at the "Castle Experience in August ’97"…I WILL TOAST YOU WHEN I SEE YOU!.. I’d been saving them to drink out of until our first deal closing) I KNOW YOU HAVE MADE HUGE SACRIFICES! Now….as I sit here this weekend alone at the age of 30…..I supposed I’ve arrived….but it isn’t all what I expected from when I first started! IT NEVER IS!
However, as our investment bankers advise me…..you are now legit!!!…YES YOU ARE!…we’ve proved all the "na-sayers wrong!".. I NEVER HAD A DOUBT! AND TO YOUR IMMENSE CREDIT YOU NEVER EVER QUIT!.. we’re back in good standing with our lawyers.. GOOD!….we’ve executed a deal on my model and now have credibility…AND IT IS A GOOD FEELING, ISN’T IT?…as well as……. we all no how it works through to a closing! FINALLY A REAL LIVE CLOSING! They’re advising they can now get more forms of structured finance for us.. AS WE ALWAYS SAID , JUST GET ONE DONE OUR QLA WAY AND THE REST WILL BE HISTORY!….now that we’re for real, have a track record and have done a real deal with a real lender! YA!
I will be temporarily relocating to Indiana to help oversee the property and the capital improvements. OK. IS THERE AN EXTRA ROOM FOR ME WHEN I COME.BY TO SEE OUR PROPERTY?…and I’m looking forward to pushing ahead again and getting even more focused. AMEN! We already have our next deal in the works. GREAT! (with the same Int’l broker that helped us get this deal put together…GOOD!.. "the guy you talked to"). I REMEMBER WELL! AND I AM SURE SO DOES HE!….this property is about 45 minutes away from A. I’ve packed all my QLA tapes & books.. AMEN!…property management books….etc…for my flight out tomorrow I AM GLAD YOU CAN FLY NOW. Perhaps this is the city or the "region" of the country that is ripe for our deals!.. REMEMBER LET THE MARKET TELL US!…Therefore I’m there for as long as we’re able to close deals! PRAISE THE LORD AND PASS AMMUNITION! LOCK AND LOAD!
To Future Quantum Leaps! AGAIN MANY CONGRATULATIONS! IT IS TIMES LIKE THIS THAT MAKE MY COACHING ENDEAVOURS WORTH WHILE! YOU NOW UNDERSTAND HOW PAINFUL SUCCESS CAN BE! YOU HAVE PAID A HUGE PRICE. IT WAS YOUR CHOICE – AS YOU KNOW MOST WOULDN’T!
TO YOUR (OUR)CONTINUED QL,
P.S. Thank you for sticking with this project.. THERE WAS NEVER A DOUBT…and me as a "mentee".. I ALWAYS KNEW YOU WOULD SUCCEED, OR DIE FALLING FORWARD!!.. WHILST YOU CAME CLOSE TO YOUR MAKER, BEING A PARA MEDIC AT DISNEYWORLD AND A EAGLE SCOUT I KNEW YOU WOULD PREVAIL!. and for "slapping me around a little" OK, BUT CONTRARY TO WHAT SOME PEOPLE THINK I REALLY DON’T LIKE TO DO THAT "ANYMORE" or getting a little tougher I WAS MORE THAN A LITTLE TOUGHER, BUT "SUCCESS AND A DEAL" HAVE ALREADY SOFTENED THE MEMORIES! HOW SWEET A FIRST DEAL MAKES EVERYONE FEEL! on me at the beginning of this deal!
P.P.S. If they only knew the true problems that had to be overcome to get this deal done and closed….and how it came so close to not closing at the last minute!!! THAT IS HISTORY! YOU ARE NOW A DEAL DOER! ASYOU ALREADY KNOW, QLA IS NOT FOR EVERYBODY – NOT EVEN MOST – BUT FOR THOSE IT IS – WHAT A RIDE!
To Your Quantum Leap
Daniel S. Peña, Sr