Mastering Creative Real Estate with Chris Prefontaine

 

Are you tired of the traditional real estate investment routes that seem to require tremendous upfront capital and extensive personal liability? What if there was a way to build wealth through real estate without relying on banks or tying up massive amounts of your own money?

That’s exactly what real estate veteran, Chris Prefontaine has mastered over his 30+ year career. In the latest episode of the Passive Investing from Left Field podcast, with host, Jim Pfeifer, Chris pulls back the curtain on his innovative “creative real estate” strategies that have allowed him to thrive even through major market downturns like 2008.

Chris’s real estate journey began in an unconventional way – by building homes on vacant subdivision lots entirely through owner financing terms. With no bank involvement, he was able to get homebuilding projects off the ground without any upfront cash simply by getting lot owners to agree to be paid later once the homes sold.

“I was naive enough in my 20s to ask vendors and landowners to wait until the house was built and sold and everybody got paid,” Chris chuckles. “And it worked!”

While that allowed him to get his start, Chris’ approach fundamentally shifted after the 2008 real estate crash decimated many of his traditionally financed investment properties that had bank loans with personal guarantees attached.

“The biggest lesson was the personal guarantees,” Chris states. “I had about 23 of those [personally guaranteed loans]. The bank came looking for me.”

Determined to never repeat those mistakes, Chris rebuilt his business model from the ground up, this time steering completely clear of banks and personal liability through creative acquisition strategies.

Subject-To Deals

With this approach, Chris acquires properties while allowing the existing mortgages to remain in the original owner’s name. He simply pays the mortgage payments on their behalf and retains full ownership of the property without ever assuming the loan.

This method has been particularly lucrative recently due to the ability to acquire properties with extremely low locked-in interest rates from years ago.  “We’re grabbing properties in every asset class with interest rates between 2.5% and 5.5% because they were the people that owned back when rates were good,” Chris explains. “I don’t know about you, but I don’t think we’re going to see those rates anytime soon.”

Owner Financing

For free-and-clear properties, Chris negotiates deals where sellers receive a negotiated price through an owner-financed mortgage. However, unlike traditional mortgages, these are frequently structured as principal-only payments.

“For single family homes, I do principal-only typically – 99% of the deals are principal-only with no interest,” Chris shares. “You never get any kind of arrangement like that from a bank.”

Then when he’s ready to exit a deal, he’s able to capture that paid-down principal as a lump sum in addition to any value appreciation.

Lease Purchases

For instances where owners won’t transfer the deed over, Chris utilizes lease purchase options to control properties and rent them out to tenants. The tenants’ rent payments are higher than the underlying lease payment, providing cash flow along the way.

These types of creative deals form the backbone of Chris’s innovative “Three Paydays” system that generates:

  1. Upfront cash from down payments
  2. Ongoing monthly cash flow
  3. A final cash payout from captured equity through principal paydown and price appreciation

Due to the structure of these deals, Chris is able to accumulate income streams and equity in real estate without any bank financing or personal investment beyond some modest closing costs.

“Any asset class can be done like that with owner financing,” Chris elaborates. “We don’t do deals unless it’s contingent upon filling the home [with a tenant].”

This creativity has allowed Chris to keep investing heavily through even the most turbulent times when most real estate investors are sitting on the sidelines.

“The world is full of people that do whatever it takes every single day, no matter how hard or how long, to accomplish all their goals. Or is it more full of people that kind of follow the herd?” Chris poses. “If we know that, then why don’t we make sure we’re going in the opposite direction most of the time?”

A prime example is the current higher interest rate environment, which has forced many prospective homebuyers to the sidelines, at least temporarily. But according to Chris, that’s created a booming opportunity for investors like him who utilize rent-to-own lease purchase structures.

With so many people priced out of mortgages for now, “They enter our rent-to-own program,” Chris says. “It gives them time to either save more money or increase their credit score to get a better loan, and it gives them that pathway to home ownership.”

Chris also keeps a close eye on the traditional commercial real estate asset classes like multifamily; self-storage in particular is one that he’s been bullish about for quite a while.

“I love self-storage to this day,” Chris raves. “It’s very unlikely at the small monthly rates that they charge…that you’re going to yank your stuff out of there unless something dramatic happens.”

Rather than acquiring self-storage facilities himself, Chris often utilizes owner financing strategies with existing “mom and pop” operators who can sell with favorable terms to fund their retirement.

For investors looking to adopt Chris’ wealth-building methods, he suggests first finding a real estate niche that resonates with you. Then locate a coach, mentor, or community aligned with your values and on a path you wish to follow.

Lastly, and perhaps most crucially, Chris recommends making a minimum 3-7 year commitment to master the strategies, as lasting success doesn’t happen overnight.

“Put the blinders on for 3-7 years, and that’s the hardest part,” Chris advises. “If you do that and you stick with that personal group…you’ll have a great experience.”

While Chris’ techniques may sound unconventional, the proof is in his results and decades of experience creating cash flow and equity without banks or excessive personal capital. If you’re interested in discovering how to break free from traditional real estate constraints, tune in to episode #159 of the Passive Investing from Left Field podcast. You’ll gain a wealth of insights into Chris’ innovative “creative real estate” system for building your investment portfolio and net worth through low-cost, passive income streams.

If you enjoyed Chris Prefontaine’s wisdom and stories, the Left Field Investors (LFI) community offers more great resources to build on your real estate investing education.

Become an LFI “Infielder” to access:

  • Exclusive educational content and investor training programs
  • Off-market investment opportunities from vetted sponsors
  • A network of thousands of like-minded passive investors
  • Virtual and in-person events to engage with experts
  • The support to confidently build your investment portfolio

Whether you are new to passive real estate investing or a seasoned veteran, LFI provides the people, knowledge, and opportunities.

Join now to take your investing to the next level!

Chris Franckhauser

Vice President of Strategy & Growth, Advisory Partner

Chris Franckhauser, Vice President of Strategy & Growth, Advisory Partner for Left Field Investors, has been involved in real estate since 2008. He started with one single-family fix and flip, and he was hooked. He then scaled, completing five more over a brief period. While he enjoyed the journey and the financial tailwinds that came with each completed project, being an active investor with a W2 at the time, became too much to manage with a young and growing family. Seeing this was not easily scalable or sustainable long term, he searched for alternative ideas on where to invest. He explored other passive income streams but kept coming back to his two passions; real estate and time with his family. He discovered syndications after reconnecting with a former colleague and LFI Founder. He joined Left Field Investors in 2023 and has quickly immersed himself into the community and as a key member of our team.  

Chris earned a B.S. from The Ohio State University. After years in healthcare technology and medical devices, from startups to Fortune 15 companies, Chris shifted his efforts to consulting and owning a small apparel business when he is not working with LFI (Left Field Investors) or on his personal passive investments. A few years ago, Chris and his family left the cold life in Ohio for lake life in the Carolinas. Chris lives in Tega Cay, South Carolina with his wife and two kids. In his free time, he enjoys exploring all the things the Carolinas offer, from the beaches to the mountains and everywhere in between, volunteering at the school, coaching his kids’ sports teams and cheering on the Buckeyes from afar.  

Chris knows investing is a team sport. Being a strategic thinker and analytical by nature, the ability to collaborate with like-minded individuals in the Left Field Community and other communities is invaluable.  

Jim Pfeifer

President, Chief Executive Officer, Founder

Jim Pfeifer is one of the founders of Left Field Investors and the host of the Passive Investing from Left Field podcast. Left Field Investors is a group dedicated to educating and assisting like-minded investors negotiate the nuances of the passive investing landscape and world of syndications. Jim is a former financial advisor who became frustrated with the one-path-fits-all approach of the standard financial services industry. Jim now concentrates on investing in real assets that produce cash flow and is committed to sharing his knowledge with others who are interested in learning a different way to grow wealth.

Jim not only advises and helps people get started in passive real estate syndications, he also invests alongside them in small groups to allow for diversification among multiple investments and syndication sponsors. Jim believes the most important factor in a successful syndication is finding a sponsor that he knows, likes and trusts.

He has invested in over 100 passive syndications including apartments, mobile homes, self-storage, private lending and notes, ATM’s, commercial and industrial triple net leases, assisted living facilities and international coffee farms and cacao producers. Jim is constantly looking for new investment ideas that match his philosophy of real assets producing cash flow as well as looking for new sponsors with whom he can build quality, long-term relationships. Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Chad Ackerman

Chief Operating Officer, Founder

Chad is the Founder & Chief Operating Officer of Left Field Investors and the host of the LFI Spotlight podcast. Chad was in banking most of his career with a focus on data analytics, but in March of 2023 he left his W2 to become LFI’s second full time employee.

Chad always had a passion for real estate, so his analytics skills translated well into the deal analyzer side of the business. Through his training, education and networking Chad was able to align his passive investing to compliment his involvement with LFI while allowing him to grow his wealth and take steps towards financial freedom. He has appreciated the help he’s received from others along his journey which is why he is excited to host the LFI Spotlight podcast and share the experience of other investors and industry experts to assist those that are looking for education for their own journey.

Chad has a Bachelor’s Degree in Business with a Minor in Real Estate from the University of Cincinnati. He is working to educate his two teenagers in the passive investing world. In his spare time he likes to golf, kayak, and check out the local brewery scene.

Ryan Steig

Chief Financial Officer, Founder

Ryan Stieg started down the path of passive investing like many of us did, after he picked up a little purple book called Rich Dad, Poor Dad. The problem was that he did that in college and didn’t take action to start investing passively until many years later when that itch to invest passively crept back up.

Ryan became an accidental landlord after moving from Phoenix back to Montana in 2007, a rental he kept until 2016 when he started investing more intentionally. Since 2016, Ryan has focused (or should we say lack thereof) on all different kinds of investing, always returning to real estate and business as his mainstay. Ryan has a small portfolio of one-to-three-unit rentals across four different markets in the US. He has also invested in over fifty real estate syndication investments individually or with an investment group or tribe. Working to diversify in multiple asset classes, Ryan invests in multi-family, note funds, NNN industrial, retail, office, self-storage, online businesses, start-ups, and several other asset classes that further cement his self-diagnosis of “shiny object syndrome”.

However, with all of those reaches over the years, Ryan still believes in the long-term success and tenets of passive, cash-flow-focused investing with proven syndicators and shared knowledge in investing.

When he’s not working with LFI or on his personal passive investments, he recently opened a new Club Pilates franchise studio after an insurance career. Outside of that, he can be found with his wife watching whatever sport one of their two boys is involved in during that particular season.

Steve Suh

Chief Content Officer, Founder

Steve Suh, one of the founders of Left Field Investors and its Chief Content Officer, has been involved with real estate and alternative assets since 2005. Like many, he saw his net worth plummet during the two major stock market crashes in the early 2000s. Since then, he vowed to find other ways to invest his money. Reading Rich Dad, Poor Dad gave Steve the impetus to learn about real estate investing. He first became a landlord after purchasing his office condo. He then invested passively as a limited partner in oil and gas drilling syndications but quickly learned the importance of scrutinizing sponsors when he stopped getting returns after only a few months. Steve came back to real estate by buying a few small residential rentals. Seeing that this was not easily scalable, he searched for alternative ideas. After listening to hundreds of podcasts and attending numerous real estate investing meetings, he determined that passively investing in real estate syndications was the best avenue to get great, risk-adjusted returns. He has invested in dozens of syndications involving apartment buildings, self-storage facilities, resort properties, ATMs, Bitcoin mining funds, car washes, a coffee farm, and even a Broadway show.

When Steve is not vetting commercial real estate syndications in the evenings, he is stomping out eye diseases and improving vision during the day as an ophthalmologist. He enjoys playing in his tennis and pickleball leagues and rooting for his Buckeyes and Steelers football teams. In the past several years, he took up running and has completed three full marathons, including the New York City Marathon. He is always on a quest to find great pizza, BBQ brisket, and bourbon. He enjoys traveling with his wife and their three adult kids. They usually go on a medical mission trip once a year to southern Mexico to provide eye surgeries and glasses to the residents. Steve has enjoyed being a part of Left Field Investors to help others learn about the merits of passive, real asset investments.

Sean Donnelly

Chief Culture Officer, Founder

Sean holds a W2 job in the finance sector and began his real estate investing journey shortly after earning his MBA. Unfortunately, it could not have begun at a worse time … anyone remember 2007 … but even the recession provided worthy lessons. Sean stayed in the game continuing to find his place, progressing from flipping to owning single and multi-family rentals to now funding opportunities through syndications. While Sean is still heavily invested in the equities market and holds a small portfolio of rentals, he strongly believes passive investing is the best way to offset the cyclical nature of traditional investment vehicles as well as avoid the headaches of direct property ownership. Through consistent cash flow, long term yield and available tax benefits, the diversification offered with passive investing brings a welcomed balance to an otherwise turbulent investing scheme. What Sean likes most about the syndication space is that the investment opportunities are not “one size fits all” and the community of investors genuinely want to help.

He earned a B.S. in Finance from Iowa State University in 1995 and a MBA from Otterbein University in 2007. Sean has lived in eight states but has called Ohio home for the last 20+.  When not attending his children’s various school/sporting events, Sean can be found running, golfing, shooting or fly-fishing.

Patrick Wills

Chief Information Officer, Advisory Partner

An active real estate investor since 2017, Patrick Wills’ investing journey began like many others – after reading the “purple book” by Robert Kiyosaki. Patrick started with single family rentals, and while they performed well, he quickly realized their inability to scale efficiently while remaining passive. He discovered syndications via podcasts and local meetups and never looked back. He joined Left Field Investors in 2022 as a member and has quickly become an integral part of the team as Vice President of Technology.

An I.T. Systems Engineer by trade, he experienced the limitations of traditional Wall Street investing firsthand in his career and knew there had to be a better way to truly have financial freedom.

Unfortunately, that better way is inaccessible to those who need it most. His mission is to make alternative investments accessible to everyone who seeks to take control of their financial future and to pursue their passions in life.

Contact Us

Contact Us (Footer + Contact Page)

Name(Required)

Stay Connected!

Sign up to be notified of our latest articles and meeting announcements.

Stay Connected!

Sign up to be notified of our latest articles and meeting announcements.