Jeff and JD sit down to talk about CT Homes’ organizational structure in this episode. The CT Homes team started out small and roles were unclear, but over time, JD and the team have established clear responsibilities for each team member. Now, the 10 highly efficient team members at CT Homes are able to complete over 100 real estate deals a year, all while having fun at the same time. JD reveals what CT Homes’ organizational chart looks like today, including what each individual team member’s roles and responsibilities are. Find out how organizing responsibilities among them members can help you increase profitability as well.
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Boosting Your Productivity with Organizational Structure
Hi everyone. Jeff Rutkowski here and welcome to this week’s episode of the FortuneBuilders Real Estate Investing Show. I’m here with my co-host, Mr. JD Esajian. Good to see you brother. Welcome back to the booth. It’s been a couple of weeks. I missed you. Yeah, I missed you too. I don’t know. I don’t know. I mean it’s okay if you didn’t miss me.
I can’t lie, JD I did miss you a little bit, but it’s good to be back. I’m excited about today’s show. We’re gonna be getting into some high-level stuff today which I think is pretty cool. You are constantly being asked, “can I come into the office to shadow you and the team shadow you? How many team members do you have? What does it take to do 100 deals a year?”
Word of the Week
We’re gonna get into that today. That actually leads me into the Word of the Week this week, which is an org chart. Simple. I’m sure you’ve heard of it before. Maybe not? Actually, I know when I got started in business I didn’t have a clue. I was the organization that was the mark on every team every position was you, you, you, you, you and then that’s it. That’s a frustrating feeling, so we’re gonna get into that.
Basically, an organizational chart is a visual representation of the structure of your company. To run a real estate investment business there are many different departments. You have marketing. You have acquisitions. You have project management. All the sales actions, all of these different areas can go on and on. It’s always wise for an investor or any business owner to have the roles and responsibilities clearly defined. That’s the Word of the Week. That’s an org chart. Let’s get into it.
Starting out
So when we started in 2004, there were three people: the founders. Than, Paul and Konrad, who has been on the show before. They are my business partners and very successful investors. It was just them. I came into the fold very early in 2005 At that time, when I joined, we had two other people. We had Marina and Laurie.
At that point, that’s six of us. Then Ralph joined shortly thereafter, so we had seven of us. And everyone was doing everything at the time. We were figuring it out. I would have loved to sit here and say “the lanes were super clear. We knew where the white lines were and no one ever crossed”, but that didn’t happen. In a general sense, Than spent most of his time generating leads and marketing, because nothing happens without that. Paul spent the majority of his time managing the projects and doing the accounting. Basically, Konrad did everything else: paperwork, the trusts, and the closing cycle. That’s a very limited description, because anything else that Paul and Than weren’t doing, that’s what Konrad Yeah. Then Laurie came in and helped them with marketing. Marina came in and helped Paul with accounting. I came in and helped with project management and then Ralph came in and also helped Than with going out on appointments to the sellers, etc.
That was the initial basically two and a half, three years of our business. This is in New Haven, Connecticut, which none of us are from. Laurie and Marina are not too far away. Paul, Than, and I grew up in California. Connecticut was just where we were living, and cold. Those of you that are from the northeast, as I know you are, know what that weather is like. New Haven, Connecticut.
And that was what life looked like in the first three years. We’ve had different size teams since then. And we’ve had interns, sometimes. We had an office where we had interns just hitting the phones and following up with leads, but what I’m going to talk about now is what CT Homes looks like currently and basically what that dynamic and that structure has been like for the last five years.
Very successful, very efficient, very defined roles now, and this is after 18 plus years. We know who does what, why they do it, and how we communicate together. That’s one of the main reasons why the statement I made a moment ago of 2020 Q1 being the best on record. That’s why that’s happening. Yes, the market is assisting, but even independent of that, the way that we’re operating in it is on point. That’s what I want to spend the majority of our time talking about today.
Team Structure
This is what we look like today. You saw the faces on the screens a moment ago. We have nicknames for people and that’s not just haphazardly, it’s fun. I don’t ever call Kevin. Kevin. I call him Beefcake. I don’t ever call John, I call him Exotic. And those nicknames stuck. It’s fun. It’s part of that culture, too. I think I played basketball with beefcake for a year before I knew his name was Kevin. We never call him that in the office. This is the org chart. We have a great team at CT Homes, and they’re amazing individuals outside of the office. They’re rock stars on the field, if at real estate, and I get the opportunity to lead them. Everything falls on my shoulders as the owner of the company, or those of you listening and watching.
President
As CEO president you start passing blame for things, that’s when the ship starts to sink. So no, everything falls on my shoulders, my main responsibilities are to make sure everyone’s hitting their KPIs and having fun like we just talked about working hard, we’re making money, we’re delivering top-notch customer service. And then on top of that managing the team, I also head up the sales department. And I think that that’s important to note, there’s, that hasn’t always been the case where I or anyone else was also managing sales. But the reason I started doing that is I am a decision-maker for City Homes. And so when I’m negotiating with a buyer or an agent through an agent to a buyer, I can make quick decisions on that process on the sales side and basically streamline their experience, especially in a challenging market for buyers to get to a price that makes sense for everyone gets to escrow faster, get to the closing table faster, get money back in the bank account faster cash, and I like it. I would consider myself to be good at it too.
I like to come in. The team does a great job buying and fixing. I also like to meet our customers too. We divide up our businesses. This is good for everyone that’s watching and listening: whether you do you’re getting ready to do your first deal, or you’ve done 100 deals or more and your cranking is we divide up is to divide up your business into we call I call them silos, but you call them whatever you want departments. Yeah, you’ve got your acquisitions department, because nothing happens. You’ve got your repositioning or renovation department, then you got your sales department. And then you got to a transaction. That makes that whole thing run. And so that’s how we divide up are our major departments at CT Homes.
Director of Acquisitions
Talking about acquisitions, Dan is the director of acquisitions. He’s responsible for overseeing all the acquisitions. That’s all the marketing that Beefcake implements and all the KPI reporting, all the offers that we write, managing the acquisitions team. That’s marketing. That’s direct to the seller. That’s the MLS. That’s making sure we’re hitting our KPIs. Make sure we have anything to renovate or sell. He’s got a meeting rhythm with his team and his team consists of Beefcake and Exotic.
Well, what’s your nickname? El Presidente? I don’t have one. There isn’t anything that stood out as good as Beefcake or Exotic so nothing stuck yet, but maybe we’ll get there at some point. I don’t know. That’s a good question, Jeff. I would love to come back to that.
Sr. Acquisitions Analyst
Beefcake actually, so he started as an intern out of San Diego State. He interned with us in his junior year of college. Then he went to study abroad his senior year, and he came back and he wanted to have a meeting about a full-time position. He’s got a great attitude and a great personality. He loves to work hard. He loves the competition of the deal.
As an Acquisitions Analyst, as I mentioned earlier, he focuses (not solely, but primarily) on direct to sell. That’s making sure the direct mail is going out, taking the calls from the individuals who are looking to sell their home, the online social media marketing that we do, and all those different channels of marketing that are out there. He takes the calls from the sellers and goes out and analyzes the deal, negotiates to follow up (which is a big part of any acquisition). Occasionally, because he’s been working with us for a while he has real estate agent relationships that will call him with off-market opportunities. And he structures those deals as well. For the most part, he’s handling everything direct to seller outside of the MLS with the exception of the relationships just mentioned.
Acquisitions Analyst
Exotic is the opposite of that, meaning he focuses almost solely on the MLS. So every day he’s filtering. We’ve done shows on filtering on the MLS and acquiring properties. He does the filtering. He does the analysis. He’s talking to real estate agents. If we walked upstairs right now chances are he’ll be on the phone with an agent right now getting information about a listed property or coming soon and going through our five steps on the acquisition side, and getting that information. Analyzing it and submitting an offer.
So that’s the Acquisitions Team. Let’s hit renovation. I started out when Paul fan and Conrad somehow wrangled me to move from California to Connecticut, leave my thriving farming career, my wranglers, and my cowboy hat in California, and moved to Connecticut, as a project manager. Paul just had too many projects for him to manage and things were falling behind. So I stepped up, started managing the projects, and, and then ultimately worked up to different responsibilities and roles.
Renovation Department Manager
Paul was the first renovation department manager, I was the second. We have another person in between, and now Michelle does that. She’s responsible for either creating the scope of work or overseeing the scope of work that gets created by the project manager. She’s responsible for hitting our KPIs on the acquisition side before we move on, or the number of offers you write, how many properties we lock up, how many properties we buy, of course, to reach our goals. Those are three of the big ones: how many properties we get under contract and don’t end up buying for some reason and understanding why that is.
Back to Michelle as the renovation Department Manager, the main KPIs when you’re running a renovation department or running a renovation is hitting your timeline in your budget. Those are the big ones. On top of that, you need to have some KPI around how many contractors you’re getting in front of and meeting. Contractors come and go. She’s responsible for a certain amount of new relationships every week, every quarter of contractors, trying new contractors making sure as I said, we’re hitting our budgets and our timelines.
Sizzle features: making sure we’re pushing our project design and that we’re not using shag carpet when it goes out of style (obviously isn’t something that we’ve used in our time of business. Wallpapers are back in style now. I’ve torn out so much wallpaper, I can’t believe how much wallpaper I’ve turned out. Now I’m putting it back in now, it’s different styles.
As a renovation managers, we got to be fresh. We got to not be doing something that was last year. We got to put new stuff in to keep costs down. Managing supply chain issues pivoting when an appliance is going to take six months, and we don’t have six months, we gotta get something else in there. Right? you just renovated your place. Yeah. And there are things that you can’t wait forever, right? Absolutely. That’s actually a limited description of what she does. But that’s major roles and responsibilities.
Senior Project Manager
Underneath her is Angel. Angel started out as a Junior Project Manager, which in our office means that they just manage smaller projects to start and they don’t create the scope of work because they’re not competent in that yet. As an example, he didn’t have construction experience when he started, nor did Michelle, for that matter.
Angel now is a Senior Project Manager. He’s pretty well versed in managing any kind of any size project, maybe independent of new construction because he hasn’t done that yet. That means the majority of these six people are kind of homegrown. I haven’t heard that anyone was recruited because they had this experience.
“Attitude over aptitude”
If you can get both, that’s great, but if someone doesn’t have the experience yet, and you have great systems to teach them, but they’ve got a great attitude, you can make up a lot of ground fast.
Project Manager
Doug is sort of a hybrid position for us over the last three and a half years. Over the last four, four and a half, five years, we got into bigger projects, new construction on the residential side development lot subdivision. It just was a natural progression for us. You really need someone on-site on those types of projects (we found) all day every day. On a new construction project that we’re just finishing up 3300 square feet of new construction at Pacific Beach from the ground up. There’s a lot that goes into the Missouri process. This is gonna trade north of 3 million. Whether it’s north of 3 million north of 300,000, there’s a lot that goes into new construction.
And Doug’s position in our company is to be on-site every day. You could say a project manager, but it’s a little different. Angel will roam around between the 30 plus projects that are actively going on. He’ll roam around to those projects (not all of them every day) throughout the week.
Doug doesn’t do that; he sits put on one or two, sometimes three new construction, big projects where we’re spending over seven figures of construction on a project. We need someone there all day, every day. That’s what he does. Make sure that deliveries are showing up, material guys or gals are showing up to work when they should, and houses are being locked up every day. We’re project managing that one, which is a combination of 25 or 35 different projects within it. That’s what he does all day every day and does an amazing job coordinating with the utilities if we got to bring in a new sewer or bring in gas or electric.
So the majority of the renovation team is going to be in the field, while acquisitions will spend more time in the office unless they’re out meeting with a seller and meeting with an agent at the property.
Transaction Manager
Now we shift over to the sales and transactional side which really is the glue that keeps it all together because there are a ton of transactional-based things that go into acquisitions in the renovations. Whether it’s contracts, ordering material, getting offers out, or getting counteroffers out, there are a lot of transactional-based things within one real estate transaction, let alone the dozens of offers that we write every week.
That’s what Mary heads up: coordinating. In California, we closed escrow and title other states use attorneys and title she coordinates interfaces with them. It’s a ton of paperwork. Make sure that we’re pre-opening escrows which for us means there are some of the same things we have to get every time to escrow when we start a new sales transaction or a new buy transaction.
Make sure those get there on time or ahead of time, manage our office manager (who we’ll talk about in a moment) Allie, or help Emma with counteroffers after I negotiate a sale. She does that and she’s also an expert in short sale negotiation as well. There are fewer of those and there have been in past times because of appreciation, but they’ll be back, unfortunately.
That’s how we originally met her. She was negotiating a short sale with another company and we were buying that property from that company. I don’t say this lightly. I don’t know many people that get as much done and work as hard as Mary. She can almost do anything in the real estate space and if not, she’ll figure it out in two seconds. She’ll tackle anything almost literally sometimes. Sometimes I even have to slow her down (I don’t necessarily slower down) when she needs help. We have team members that we brought on and we’re bringing on another one soon to assist.
Her job is to make sure we buy and everything we sell and everything we transact is done as fast as we can, as profitable as we can, we’re not wasting any time on paperwork. When we have short sales and negotiate, she’s interfacing with the bank getting us the best price. She’s also really good with technology. She helps in that department as well. She manages the whole transaction side.
Office Manager/Project Coordinator
Now underneath Mary, Alli is our Office Manager/Project Coordinator. Now, an Office Manager is what a lot of people would think of: keeping the office neat. We have these little fridges that have a little those Bubles that are in there and making sure that is stocked. Make sure people are greeted when they come in, those snacks we have in the office.
Beyond that (and I would say more importantly) is she’s the one who also turns on (as the project coordinator side) the utilities we buy, turn off the utilities when we sell, activate insurance when we buy, cancel insurance so that a year after you own the home, you’re not still paying for insurance. You can ask me how I know that problem exists. If you don’t have someone managing that now you’re paying insurance or you’re paying someone else’s utilities for the next year. When you have a lot of projects or one project if you’re not thinking about it, those things can get missed.
She preps the contracts for the contractors when Angel or Michelle are finalizing negotiations on budget with a contractor to get started. She does help from time to time ordering materials when we’re needing that as well. She fills in a lot of those voids. She does, does very important things but again, not things that you as the president or CEO need to be doing every day.
Sales Assistant
And then lastly, but certainly not least, our most, our newest team member it’s been over a year now that she’s been with us but our most recent new hire is Emma and Emma is our sales assistant. She works very closely with me and with Mary was scheduling open houses prepping the listings, getting the listings, active coordinating the photo staging, receiving offers, helping to negotiate offers getting counter offers all the things that go into selling a home listing a home marketing a home, getting a home closed and that’s why she falls under Mary’s management primarily although mine as well is because there’s a lot of things that happen we get to get to the closing table or getting to the closing table that fall under Mary’s transaction side.
So all in all, there are 10 team members independent of myself nine individuals who operate how they operate although very limited description because the time but this is the team that for many years now and this year will be no different will crank out and 100 transactions in San Diego County make a lot of people happy getting them out of bad situations on the buy-side getting them into great situations on the sales side when we go to sell them and delivering what I consider to be left above 10 Customer Service leaving people better than when we found them. Changing San Diego one house at a time.
Summary
There you go there you have everyone Mr. JD Esajian and CT Homes’ organizational chart. Hope you enjoy the show. I appreciate you guys tuning in as always. Help me get a nickname for JD. Drop that in the comments and we’ll hook you up here soon.
Thank you. I’m curious to see what comes out. I appreciate everyone watching and we’ll see you next week on the FortuneBuilders Real Estate Investing Show. Take care
