Episode 55: Getting Lean
Cutting body fat, 5% yields, and your iPhone is dirtier than a toilet seat
For some time now, you may have been receiving my weekly note, ‘3 Tweet Thursday’ with the 3 best tweets I’ve found on the internet. That has been fun to send because lots of people love it and I get a lot of good feedback. I think it’s 1) useful, 2) entertaining, and most importantly 3) quick. in a world full of constant emails, it takes 30 seconds to read. Which is why I think most people like it.
I’m going to keep sending that. But in addition to that, I’m going to start sending a monthly read, in which I talk about things I’m interested in — primarily in health and business and I’ll talk a little bit about what I’m doing in life. In 2020 and 2021 I was writing longer-form weekly. I think monthly is a better cadence for me. I’ve been inspired by Justin Mares great monthly newsletter, which you should check out here. I hope you like it. Let’s jump in.
👀 what’s new
over the past year, i’ve decided to get more serious about my health. In 2022, I had decided that I was going to “bulk”. In reality, this was just an excuse to eat really poorly. By July of last year, I was at 23% body fat. I have been going to the gym since I was 14 years old. I’ve generally been a healthy person but have been inconsistent over the years. Seeing 23% body fat was a tipping point. I was 33 years old and realized I needed to make a huge change to maintain consistency. Since then, I’ve become very dialed in on my health (and also longevity). Fast forward to today: I’m at ~14% body fat. Here’s the most important things that helped:
Sleep: I get a full 8 hours most nights. I believe good sleep is the most important thing that helps drive the rest of the healthy behaviors.
Exercise: Lift weights 4x/week. Walk 30 minutes everyday (more recently have been walking with a weighted vest). Notice I didn’t do intense cardio to reduce body fat.
Nutrition: Eat whole foods. Really focus on hitting my protein targets (I believe most people don’t eat nearly enough protein) and maintain a low-carb diet. My plate consists of veggies, a protein, and a healthy fat. On Saturdays, eat whatever I want.
There’s a bunch of other more weird “bio-hacking” type stuff I do, but I’ll spare you the details for now. These are the basic building blocks.
I wanted to hit my body fat goal within 6 months and it took almost a year. But now that I’m where I wanted to be, it’s time for the next phase. In 2 weeks, I’ll adjust to my next goal of adding ~30-40 pounds of muscle and maintain my body fat percentage. I think this will probably take me another year to year and a half. By the end of this year, I should be able to add ~9-10 pounds of muscle.
💰 money stuff + real estate
I haven’t seen any investments this year that could be considered “fat pitches”. The Fed has increased rates by 500bps, but cap rates have barely moved. The only thing I can think of is putting money in US Treasuries or Savings accounts that are now yielding anywhere from 4% - 5%. That’s basically where I’ve allocated all my capital this year, besides making a small investment in a proptech startup and continuing to DCA in VOO, and re-investing into my own businesses. I’m looking for ideas — where are you investing besides U.S. Treasuries? What do I not know about that I should?
As for Real estate, this was a good tweet from Moiz which explained the current situation of the disconnect between buyers and sellers. There’s ~$4.5 Trillion of commercial real estate debt. $1.5 Trillion is coming due over the next 3 years. An estimated ~$700 Billion is in multifamily. Much of this is bridge debt. This is one of the reasons we haven’t seen significant decrease in multiples in multifamily RE — owners still have time with their current loans. In 2024-2025 if interest rates are still hovering where they are today (or higher) these owners will have a few options:
sell their properties (for likely a lower multiple than when they bought). Important to note this doesn’t mean “sell at a loss”, but rather a lower multiple of earnings. If they haven’t increased NOI enough to offset the cap rate expansion, then they will sell at a loss.
“extend and pretend” — dependent on the loan docs, owners have an option to extend the term of their loan. This may be an extension of 1-2 years. typically this comes with some contingencies, like paying a fee to extend.
capital call - if the owner wants to refinance into a new loan but they need to bring equity to the table, you will see capital calls to LPs. LPs typically don’t want to invest more proceeds during the life of holding the asset, but this isn’t the worst thing in the world. Especially if you have a good asset, in a good location, with good property fundamentals. But, if you don’t have any of these then why would an LP want to invest good money after bad?
restructure loans - lenders don’t want to take over assets. if owners aren’t able to call capital, sell the asset, etc. then you may see lenders be willing to restructure loans in order to help work with owners. again, you’re going to need to be a good operator to make sure they actually want to work with you.
generally speaking, multifamily has had great fundamentals thus far while the economy has been shaky (higher rents, occupancy, collections, etc.), which has helped values hold up relatively well. if the fundamentals sour (e.g. like office), then you will likely see a huge drop in values. but we have a housing affordability issue in this country & people need a place to live. i could see pockets of multifamily getting hit (e.g. markets that have over-built supply), but overall it seems multifamily has held up well. although, it’ll be interesting to see what happens to rents and collections once student loan repayments re-start this summer. ultimately, in 2024-2025 it’ll come down to how much supply (investors who want/need to sell) matches up with demand (investors wanting to deploy capital into multifamily) that determines what market pricing is.
🌍 cool things you might be interested in
📰 Article: it’s been about 6 months since Bob Iger re-took the helm as CEO at Disney. This was a great story to learn what went on behind the scenes. If you’re a business nerd like me, I think you’ll enjoy it.
📚 A book: there’s a theory that the U.S. government hasn’t done anything meaningful since the Manhattan project. Regardless if you agree with that or not, I realized I didn’t know enough about the creation of the atomic bomb. I wanted to learn more about the factors that lead to such an impressive project in a short amount of time. I’ve been reading ‘The Making of the Atomic Bomb’ and it’s been pretty good.
🍿 A movie: I saw Air last month. The story of Sonny Vaccaro and the Nike team and how they landed Michael Jordan as the guy that saved Nike basketball and took Nike to new heights. Today we know of Nike as the global behemoth and premier shoe and sporting brand. But just a few decades ago, they were only really a running shoe company. It was a great film.
📱 A cool gadget: our cell phones are extremely dirty. every evening, I throw my phone in this UV sanitizer box. the data isn’t conclusive on if it works — but i’m willing to experiment for myself for something that seems pretty obvious and has likely no downside.
That wraps up episode 1! What questions do you have? What do you want me to talk more about? Let me know. Have a great start to the summer and I’ll see you next month.
Rohun