HEATHER EWING: The CRE RUNdown

Ep. 31 Flipping Dirt with Mike Deaton

• Heather Ewing, CCIM • Season 1 • Episode 31

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What would you do if life threw you a curveball and disrupted your career path? Join us as we uncover the incredible story of Mike Deaton, who transformed a corporate setback into a lucrative venture in land flipping and commercial real estate. Discover the pivotal moment in 2016 when both Mike and his wife found themselves laid off, prompting a life-changing decision to downsize, relocate to Colorado, and build a business that not only replaced but exceeded their previous incomes. Mike’s journey serves as a testament to the power of introspection, intuition, and seizing life’s opportunities.

Ever wondered what it takes to succeed in commercial real estate? Learn from Mike’s experiences as he shifted from being a limited partner in multifamily investments to taking on more dynamic roles in the industry. We discuss the significance of having a resilient mindset, the importance of finding your niche, and the value of learning from mentors. Mike shares invaluable insights into various real estate asset classes, including triple net leasing and storage units, and underscores the importance of maintaining a beginner’s mindset to navigate the inevitable ups and downs of the real estate world.

Prepare to be inspired by Mike’s return to running, transforming it from a high school punishment into a meditative and social pursuit. Hear about his journey from running 5Ks with colleagues to participating in grueling ultra-marathons like the Leadville 100. Mike draws fascinating parallels between endurance sports and business, emphasizing the necessity of a strong “why,” a well-thought-out plan, consistency, and adaptability. This episode celebrates living fully through experiences, with Mike sharing his love for travel, adventure, and the joy of being present in each moment. Connect with Mike and learn more about his ventures at flippingdirt.us.

Heather Ewing, CCIM:

Welcome to Heather Ewing, the CRE Rundown. I am your host, heather Ewing, and today I have, from lovely Colorado, mike Deaton. Mike, welcome, thanks, Heather, excited to be on the show. Yeah, I'm so glad to have you here today. So I've known you a little bit through LinkedIn. But for our audience, give them the spiel who is Mike Deaton? And tell us about land flipping.

Mike Deaton:

You bet so gosh. I'm a native Texan group in the Dallas-Fort Worth area. I spent most of my life there, kind of with the normal path. Maybe it's not normal so much anymore, but you know, college got a job out of college, worked the corporate hamster wheel for over 20 years. 2016 was victim of a layoff and, after dodging dozens, you know, throughout my career, my wife also found herself out of work that kind of same summer in 2016. And so, rather than just jump right back into corporate, we kind of both had nauseous feelings about getting back into the workforce like that, and so we just we were able to pause. We reflected on what we wanted out of life and it was really just more time together.

Mike Deaton:

We were living in Plano, texas, at the time. We wanted more time outside and doing things. We wanted more time outside and doing things. We were in the 40s, you know, in both of our in our 40s at the time, and we were like you know, we want to be able to enjoy what life has to offer today rather than, say, for retirement, retire hopefully, and then maybe be physically fit to do the things we wanted to do.

Mike Deaton:

So we took the opportunity to really shift gears. We got into real estate. Land flipping was our entry point. We moved from Plano here to Colorado not exactly this house, but we moved to the Boulder area. We rented for a few years, we downsized so that we could start a business and not have too much pressure on us in terms of having to do it too quickly, and then after a couple of years we really ramped it up into a very healthy business. We've replaced our income. We were growing beyond what we were making in the corporate world and subsequently we were paying a big tax bill. And so we got into commercial real estate as well to offset and take some passive losses and keep more of our income in our pocket. And so, you know, we were able to move here to a beautiful home here in the mountains of Colorado, and we've been here for two and a half years or so. But other than also being a runner, that's kind of me in a nutshell.

Heather Ewing, CCIM:

God bless you.

Mike Deaton:

Yeah, yeah, so yeah that's kind of the. I would say that's the rundown of what led me from there to here and, yeah, we love it. It's been great. I couldn't have dreamt of a better life, honestly, than I think when we went into entrepreneurship, we were both skeptical, nervous, unsure if things are going to work out, but they've worked out much more quickly than we dreamt, so it's been great so far.

Heather Ewing, CCIM:

That's terrific. And there's two things that you said, that you took pause and you reflected. Those are two very powerful actions, right. And when I think about it, when people get laid off, usually something has hit the fan right. Not that I'm sure you were alarmed Anyone would be.

Heather Ewing, CCIM:

But, what I love. What you both did was to pause to reflect. What do we want? How do we best utilize this time? What might life look like? And I think, in taking those steps, that's how people revolutionize their life and bring it from good to grand, wouldn't you say, and bring it from good to grand.

Mike Deaton:

Wouldn't you say A hundred percent? I mean, I tell this story and coach clients and all of this stuff. Exactly that point I mean introspection and reflection on not only what you want out of life, but where you are in life and the things that you're doing is so powerful and important. Because, like I said, what I thought was the normal path was go right out of high school into university, get right out of university into a job, chase promotions, buy a house, buy a bigger house, have kids you know just it. All snowballs. And I watch it. I have two older daughters that are in their twenties and I'm kind of watching them go down a similar path and I'm kind of watching them go down a similar path.

Mike Deaton:

Very quickly, you get trapped, like they are, you know, a little bit stuck in trying to pay the monthly bills. How do I even switch careers? I don't really like my job. How do I do that? And so you know, fortunately in 2016, when that happened, we were one in a position to do it.

Mike Deaton:

So, empty nesting, it was only my wife and I. She's super supportive. She kind of comes from a different background than I have. She has a little more tolerance for risk in that way. And so, you know, padding at least for me we had a bit of security, but then too, we actually listened to the intuition or the gut feeling or whatever that just said. I don't like the direction I'm about to take and, you know, those things lined up such that we were able to to make that choice in the moment and do that. And yeah, I don't look back with regret because you know my life led me to where I am. But I think a lot of times we do get caught just on the hamster wheel or the rat race or whatever term you want to use that we're just going without giving too much thought to. Is this where I want?

Heather Ewing, CCIM:

to be going.

Mike Deaton:

And have I designed my life in such a way that I can pivot? If I want to right, we get the trappings of the American story.

Heather Ewing, CCIM:

Right, and I think, too, that storyline has such momentum, speed and velocity and it's easy to access, right, anyone will tell you how to become an accountant, how to do this, that or the other thing, and I think back to my own you know, in the early days of you want to get something stable, something that pays well all of those right Get your 401k, the two-week vacation in the beginning, things of that nature and I never heard about commercial real estate and, realistically, I didn't hear about it until my 40s, which is when you know, like I knew of commercial real estate, but I had no idea there's people that make a living off of retail and restaurants, where I was like, oh my gosh, you know, it was like a Lady Gaga awakening a baby.

Heather Ewing, CCIM:

I was made for this, you know, and I think it's really neat and you probably see a lot of it in your coaching is that no-transcript gut feeling and it builds momentum, just like your endurance races 100%.

Mike Deaton:

Yeah, it, I think it's Tony Robbins. It says you know when you, when you think you have one choice, you're trapped. If you only have two choices it's a dilemma, but it's once you get beyond that into three, four more choices that you feel really resourceful and you have all these options and it does feel that way. I mean real estate. For me also, finding it late in life, is so powerful because there are so many different ways that you can choose to forge your own path, whatever resonates with you right. You can be passive, investing, you can be a landlord, you can be active in the business, you can broker deals, you can lead deals, you can. I mean there's just so much opportunity there and it's incredible. And yeah, I do think it's almost's not really a secret. That's, I think, actively being being put on everybody, but it's just there's less publicity and visibility about it, at least through the traditional education system and work system. And yeah, it is.

Heather Ewing, CCIM:

I agree, Right, there's just so many ways of going about things and what I've noticed too, is that people might try to your point one area within commercial real estate or real estate it's just not aligned for their personality or interests and then they just write off the entire thing and it's like do your due diligence of try the different asset classes, ask questions, and I think people need to have a beginner's mind and to really expand upon it and kind of go down the rabbit hole of what leads to this, to this, to this, and to really open up that box and find the right thing, and maybe at the end they realize none of it really pertains to them.

Heather Ewing, CCIM:

But at least then they know and it's not, oh gosh.

Mike Deaton:

I wonder if, years later, yeah, we found our way into, like I said, commercial real estate and for the benefits of tax depreciation and diversifying our portfolio. And so we struggled with which asset class do we want to get into, and at the end of the day we just decided, ok, well, let's just pick one, go try it out. And we did that. We went into multifamily and we worked our way across the spectrum. So we started as limited partners, we just passively invested, and then we got in to doing some due diligence on properties with teams, and then we expanded into raising some capital for deals, and then, you know, we got more into the operations and the underwriting and finding deals. And then, you know, we got more into the operations and the underwriting and finding deals.

Mike Deaton:

And so, yeah, through that process we figured out oh gosh, I really despise this aspect of it and rather focus in these areas. But, to your point, it can also be different asset classes. I mean, even since we've been in the world, we understand now, oh, there's triple net leasing, there's retail, there's all these different types of real estate that resonate with storage units. Right, there's no tenants involved. There's different things there. Yeah, you can definitely find a niche that works for you and a way to function within it that is great to be a part of.

Heather Ewing, CCIM:

Definitely. How would you say with all these different variables? How would you say mindset ties into this.

Mike Deaton:

Well, it's obviously an intricate, different mindset that comes into play in terms of how you go about finding deals and networking, and then even the not every deal is going to be successful most likely, and so you have to kind of understand the strategy there and take some wins and losses On the active side of the business.

Mike Deaton:

You know there are different aspects of mindset, but it's critical to you know, come in with an open mind to have that. You mentioned a beginner's mindset or I think that's so such a critical aspect of knowing that there are so many other ways to go about doing things, learning from mentors, from coaches, from other people that have been down paths, and I think that's very critical. One of the things that, within the last year, we started doing is coaching other people in the land business, which we're a part of, and one of the first things we do it's all about mindset, it's understanding why are you getting into this, building a compelling picture of goals and targets, and to help, because there are ups and downs and you need that, that mindset or that anchor to really pull you through, to, uh, through any valleys or or low points. Um, because, yeah, there'll be obstacles and resistance in in any endeavor, and um it's all, it's all.

Mike Deaton:

Face it right. Residential in 08, uh, commercials, going through a little bit of it now, right, well, back in COVID. Um, you know all of this stuff takes hits and you just have to understand that it's a part of weathering the storm and keeping a resilient mindset.

Heather Ewing, CCIM:

And I think you hit on another important point, which is your why. And whether that's real estate, whether it's endurance, running, sports life, I've noticed that when people have a why, it is that anchor, it is the foundation that, even when the times are challenging and you just wanna you know, you ask yourself why did I begin this?

Heather Ewing, CCIM:

That it helps you to reframe, reset and to dig back in with that vigor, because you know that it's only a period. There's never anything bad for too period. There's never anything bad for too long. There's never anything too great for too long. There's always that ebb and flow in the cycling. So, as we tie that into the endurance sector, which we both love, tell our audience a little about your endurance racing and how you got into it, and also how does that help you with real estate.

Mike Deaton:

Sure, yeah, I got into running. I think I was 30 when I refound running Running for me. I was an athlete in high school and it was always brought to me in terms of a punishment right, you did bad things go run, do laps, whatever. So once I left high school I was never running again. But I kind of got back into running more in a social way. I had some colleagues at work that were into doing 5Ks and so somebody invited me to one and I went. It was a great time there was. It was a big social. You know I didn't do great, but there was beer and a buffet and a bunch of people afterwards and so you know, I kind of got into it from that aspect. And then, once you're in, I think for most of us this is the case where you do a few 5Ks and you think I could do a 10K and then it's a half marathon and it's a marathon, and now I'm dabbling in ultras, and so last year I signed up for this kind of crazy challenge.

Mike Deaton:

Since we moved to Colorado, I've been a bit enamored with the Leadville 100, which is a mountain ultra trail race, and, like David Goggins ran it a few other people and it's always intrigued me. But it's really hard to get into and I found a backdoor in which is if you sign up for five events over the summer, then you're guaranteed entry as long as you finish, as long as you start each of those five events.

Mike Deaton:

And so last year I went about. I signed up thinking okay, this is great, and the marathon is first. I just ran last weekend, this year's marathon, and I kind of bombed out like it was snowing. It was June, it was snowing in the mountains, it was like a freak snowstorm and I got about 15. My wife was waiting at one of the aid stations and I was like you know what I'm just done with this. This is crazy. And so it kind of derailed me mentally. I thought, ok, I've, I've messed up this whole challenge. What's the point?

Mike Deaton:

And so this year I decided to go back in, and understanding, or at least creating a strong why was a big part of reentering it this year. And so yeah, for me, for me, running is very meditative, it's very reflective. I love now getting out. My wife will ask me do you get lonely running by yourself sometimes out. My wife will ask me do you get lonely running by yourself sometimes? I'm like I actually, you know, I love it. It's just my time to think, to work through issues or just to veg out. We live in the middle of just gorgeous, we're close to Pikes Peak, and so I kind of run in the foothills of Pikes Peak, around a reservoir typically, and it's just.

Heather Ewing, CCIM:

It's my time and so, oh, that's beautiful, but the endurance part of it is really just more of a test.

Mike Deaton:

It's can I do it? Do I, you know? Can I piece together the training, the mental, all of this to come together on a day to to go through it? So, like I said, I just ran the marathon Saturday. It was grueling. I mean, there's like, I think, 7,500 feet of elevation gain.

Heather Ewing, CCIM:

It's up and down a mountain, oh wow, congratulations, by the way, that's awesome, yeah.

Mike Deaton:

And then this weekend, so seven days later, is a 50 mile, also in the mountains, and so this was kind of a training run. But after the marathon I was like I don't know that I'm even going to do the 50 mile. This is crazy. But you know, a few days have passed, I've reset a little bit, so now I think I'm energized.

Heather Ewing, CCIM:

Spoken like a true runner.

Mike Deaton:

I'm like, oh no. And then it's like we've had a few days, why not? Right, yeah, the marathons are that way. I'll run a marathon and I'll be like gosh, I'm never running a marathon again, or an ultra or whatever. And then, yeah, a few weeks go by. It's like I bet I could do a little better if I did it again.

Heather Ewing, CCIM:

Exactly. You start breaking it down right and you start creating a plan and building it of what went well the first time. What do you need to shift this time? And that's where, too, I can completely relate that I do a lot of running solo and it is meditative. It's also when I get different ideas for deals, or maybe how to creatively merge a gap or, you know, make something happen. Or maybe it's a new offering that I just haven't thought of and I think so many people dislike it. The conclusion I've come to is that you do have to be present, right, because you do feel your body of what's going on. Do you have to be present right, because you do feel your body of what's going on, what's type, what you know, all these different things, and in that sense, I think it's also very awakening because you are present. But then after a while, you kind of shift out and it's like you're just floating out there too. So it's it's a little bit of both. It feels like for me.

Mike Deaton:

Yeah, and just circling it around to your, your question about tying it into real estate. I think sports in general is so applicable to business and life and everything. But you know, with endurance it's just about having a plan, having a why to start with putting together a plan, being consistent and just staying uh in the moment, being able to adjust right if your body's telling you something to kind of like this week, the first couple of days of the week I've been pretty actively resting. I've gone on a few walks, I've just let my legs recover. Now they're feeling pretty good, so I'll probably either get on the bike later or go out for a light jog or something. But all of these things apply and you know there are periods for really digging in deep and there are periods for backing off and taking a break and all of that stuff. I mean I think it really builds, especially for most entrepreneurs.

Heather Ewing, CCIM:

um, regardless if it's running or cycling or some other activity, I think you can apply a lot of the, the training principles and lessons, uh, into business definitely, and I think one of the other nice attributes of it is that with commercial real estate it takes months, sometimes years, to do a deal, and the nice thing is you can train for a marathon in four short weeks and then you've accomplished something, so it feels like immediate feedback compared to the other things that we do.

Mike Deaton:

You can maybe train for a marathon in four short weeks. I'm not sure everybody can, or?

Heather Ewing, CCIM:

I'm sorry, in four months.

Mike Deaton:

Okay, that's better.

Heather Ewing, CCIM:

Yeah, if I had that secret, mike you know, that'd be a whole nother profession.

Mike Deaton:

Exactly.

Heather Ewing, CCIM:

But, as we wrap this up, my final and the most, you know, inspiring question is what does living fully mean to you?

Mike Deaton:

wow, that's a that's a loaded question. Um, I think it's. Obviously it's different for everybody. For me, you mentioned being present and, and I think living fully is really as much as possible being present in the moment and being able to fully experience anything. So when I'm out on a run, I do try to mindfully make sure that I am being appreciative of my surroundings, and while I do listen to things, a lot of times, a lot of times I won't, I'll just want to be immersed in it. It's the same in work, or the same in your relationships. I'll just want to be immersed in it. It's the same in work, or the same in your relationships. I think if we're too busy reflecting on the past or worrying about the future, we miss these moments of being alive and fully alive, and so you know, obviously it's different for different people.

Mike Deaton:

For me, I love experiences. I love traveling, going on adventures, visiting with family. It's those kinds of things. I don't. We don't have a lot of material things at this point. I mean, we like to live in a nice house, but other than that, just not a lot there. It's more experiential for us to, and having good experiences is about being present, because you'll miss the experience. If you're not so you know that for me is really living a full life.

Heather Ewing, CCIM:

That sounds perfect, and I enjoy seeing your pictures too. When you float them through on LinkedIn, it's always like oh, there they are, it looks perfect. So I agree, traveling is a true joy in life it's the adventure, the foods, the shared experiences and learning. So, mike, thank you so much for joining me today. And how can, how can our audience connect with you?

Mike Deaton:

Oh yeah, well, thank you for having me. The best way to get in touch is we have a website, flipping dirt dot us, and if you go to flipping dirt dot us, slash freedom. We have a lot of contact information. There's a way to make an appointment if you want to flippingdirtus freedom. We have a lot of contact information. There's a way to make an appointment. If you want to set up a call, the phone number, email. That that's kind of the best way to get in and you can also see a little bit about what the world of land flipping and land investing is all about perfect.

Heather Ewing, CCIM:

Thanks so much, mike thank you, heather.