My Thoughts On REAL ESTATE, INVESTING & HOW TO SUCCEED In 2021 | Kevin O'Leary & Barbara Corcoran

i don't think these commercial properties are going to do well at all in fact i think they're going to lose a substantial portion of their value over the next six months per year we have companies where sales are down but cash flow is up now how did that happen and he's working alone as i went in for my coffee today i said hey where where are your employees he said i can't get them to come back making more money on unemployment so kevin what's going on where are you located right now you're at you're i'm i'm at a lake i'm at a lake in canada that's right i'm going to spend a couple of weeks here i just left florida barbara which was crazy as you can imagine just crazy i almost lost you there i was there for four months i'm sorry i was there for four months and um it was really nuts and it opened up then it closed down and it opened up and it closed down and when i left it was closing down again to to a bigger close down than it ever was no walking rights and all kinds of surprises i think they're doing the right thing because they got to nip this thing in the bud like other countries have done and i think it's a little slow would you say that florida is probably our best example of a slow on the draw so to speak yeah i'm getting notifications every day from my building and they say they're now testing twenty percent positive for everybody wow that's amazing so you got out of there at the nick of time but you you and your wife are healthy right your children and i did the whole test thing anyways and everything else but i was just listening to you talking about real estate i'm fascinated about that because um i'm just wondering because you're a real estate person barbara what's going to happen to triple a office towers you know i own some of them through reits if people don't feel safe going up those elevators to the 70th and 80th floor what's i mean what are the values going on i'll tell you what's going on in new york city it's not just the elevators nobody wants to get in a crowded elevator but long before they hit the elevator no one wants to commute to work they don't want to jump on the subway they don't want to sit in a car for two hours and they've had the unusual opportunity that they were allowed to work at home and people are loving it i think it's going to be a tall order to get people back to the workplace as we knew it before and i don't think it's going to happen i know there's a new movement here in new york city where teams of people are coming in like your marketing department comes in one day the next day your research department comes in so they're rotating people which means less desks are needed and what's concurrent with that is every landlord in town is hearing from every tenant they're renegotiating leases even if they have five or ten years left on the lease everybody is holding back on rent we're going to see a bloodbath i'm sorry to tell you if you've been well invested in reits i don't think these commercial properties are going to do well at all in fact i think they're going to lose a substantial portion of their value over the next six months to a year so can you get out is my question yeah i have i've reduced my exposure from almost 30 percent down to eight and i've also sold all the regional banks and the money center banks that own the mortgages um obviously i took some losses but they've gone down significantly further since so clearly the market is figuring what what you're saying i'm just wondering is the impairment can be 25 35 what do you think two or three years from now a building that used to sell for 100 million is going to sell for 30 off i had a guest but you know what guesses are they depend on the future but i would say from where i sit there 30 off yeah but that's not the real problem the real problem is who's going to want to buy them i don't think a lot of people are going to have an appetite for that even at that steep discount wow well and just just before we leave real estate what about i heard you mentioned wait wait wait wait wait kevin hold on a minute hold on i'm interviewing you you're not interviewing me well i figured if i can look if i can learn something while i'm talking he would get some value out of you barb it's the first time it's ever happened that would be great that's my kevin just quickly on condos in new york because you know i am shopping around by now or wait oh kevin you're not going to buy anything you've been shopping around for four years you're too cheap to spend the money i want to buy your condo barbara i want your time 50 you wouldn't open that wallet i know you you're too cheap why can't i kick you out of your place i'll take your place i like it my place is beautiful but i would never move out you'll have to take me out in a cough and i'm afraid yeah yeah if you want to spend if you want to spend a lot of money right now on a brand new condominium on a serious dough which again i'd say you never will um you could get substantial kid discounting already to the 20 25 if you work directly with the developers they don't admit they're discounting but any deals that are happening which are so few are steeply discounted the reason people don't know how bad that market is because many of the developers are built for the future so they can't close yet but when you see those closing prices roll out you're going to say to me barbara i should have listened to i should have bought back then because now look what i have to pay now but you won't buy then well my problem is i don't want to live i don't want to live in hotels anymore when i go to new york when things get back to normal whatever they're going to be because i just i don't want hotels but i don't want to be around yeah you've been saying that for years you're going to stay in the hotel because you don't want to put the money out let's move on from right here if i catch a cold blogger i'm blaming you again kevin let me ask you a question what advice have you been giving your entrepreneurs we both invested a lot of businesses some do so much better than others some are dead on arrival some we're questioning all the time but nonetheless we're in the position of of an advisor an investor what advice overall have you been giving your investments as to what they should have been doing and still should be doing through this pandemic i'm curious because i want to steal that advice if it's any good well the ones that have been successful you know i've got some that are involved in industries like the wedding industry which has been decimated and i've got summer in restaurants which has been killed but the ones that are selling goods and services that have really been successful and i just this morning got off the phone with two of them have basically set up shopify uh platforms they are lots of their products been kicked out of retail or they're not selling retail anymore so they've gone directly to their customers now here's the thing to note barbara this is what shocked me today if you were selling uh well you'll find this interesting we have companies where sales are down but cash flow is up now how did that happen instead of paying 50 percent to retailers and distributors they've sold direct to customers they've been able to capture back at full margin so you look at the success of a love pop greeting cards which was 50 in in retail which is now basically all online at full margin they're just killing it yes of course i'm sorry go ahead yes and i have another one uh bertucci uh pizza ovens a deal i closed very recently um it's one of those rare deals where because of everybody staying at home sales are 400 percent ahead of schedule i've actually made all my money back on that deal it's only been five months wow that's terrific what are you going to advise them as uh things return slowly to normal they're not going to be selling that many pizza ovens anymore maybe but what i've been able to do with them as i said if people are willing to buy these pizza ovens we need more direct to consumers so this morning i i just got a deal with um qvc we're going live on the early august we're going to sell a huge amount online and i think you know you've got to make hay while the sun is shining on some of this these situations and and for me the direct to consumer is not going away i don't think this trend is going to stop we're not going to sell as many ovens to retail anymore because we have to give up 40 percent margin barbara i don't want to do that sell direct and the consumer also gets accustomed to a lower price uh you're very familiar with my most successful deal from two years ago the comfy which is an oversized sweatshirt uh they were in a pickle the minute the pandemic hit they couldn't sell through the stores they had almost 30 million dollars in merchandise and stores that closed up they got all that merchandise back they didn't know what to do and exactly what you said they sold direct to the consumer and they've almost doubled their sales i really prayed for the most nights saying are they going to go down they're in trouble now they just turned right on their heels and slammed at home on the internet and they've been selling twice as many coffees go figure it out so yes i don't think that's the trend that's going to go away i hold hardly so the pivot to direct to consumer is a worldwide phenomenon and i think you know when we get back to shooting shark tank whenever that happens we're going to see a ton of deals that are focused on doing just that the old distribution model is going to change i think it's going to be more efficient i don't think retail is going to ever look the same as what it used to i think there's all kinds of malls across america that are going to be changed into cloud kitchens or inventory for climate control for direct distribution who knows but wow what a change it happened real fast do you think on shark tank you're going to shop with that in mind like put your entire focus on those businesses that are direct to consumer and not invest in anything that is not because i'm sure we'll see our share of various kinds of businesses as we always do well if your strategy is all retail i'm going to pay a big discount for that because that's riskier than anything today because i'm not sure that all right look at all the bankruptcies neiman marcus who could have even thought they'd go bankrupt they're worthless now worthless and so and if you are selling through there you're probably going to wait months to get your inventory back and all the rest of that stuff i think at the end of the day yes i am going to look for companies that are going to do better online that have the savvy social media skills to tap that versus ones that just tell me oh let's go sell through retail that's what i think yeah well i could hear your picture already i'm sorry uh you'll be talking to one entrepreneur after another and insulting them with a low bid and using that excuse again and again you always come up with an excuse to pay very little and to beat those poor entrepreneurs into the ground and for those people who are listening give me a feedback on that what do you think about the way kevin beats up on these entrepreneurs it breaks my heart you know at times i'm sitting on the set you don't see it on the camera i'm crying my eyes out i'm breaking listen barbara let's tell the truth because where we have to be honest there's a reason they call me mr wonderful there's no false advertising here okay yeah that's false advertising moving on from that of course hey listen what uh what do you think other than direct to consumer are the big opportunities out there right now because we have a huge audience of young entrepreneurs struggling some people moving ahead but what do you think are the big opportunities for young entrepreneurs to take advantage of right now other than direct to consumer two areas that i want to focus on in and outside of shark tank number one is health care i think people are going to be very very focused on going on health and i'm fascinated by better food groups i think people are now having been locked at home and doing so much cooking on their own or fascinated by food options and i want to get into foods that are healthy uh sustainable good to eat and i've been cooking like a banji myself chef wonderful gotta see oh yeah of course chef wonderful has been a flower that's been blooming just a chef boyardee what i hope we see is a whole lot of health initiatives things that help people live a healthier life i'm not saying just exercise equipment i'm talking about you know maybe more deals like blue land the thing i did with the disinfectants and detergent was crystallized that was a big success for me there's another one barbara that was a big rollout if you recall they were having they were going to do a giant retail rollout okay we were just i'm gonna push you one moment again kevin just for the sake of the people who are listening whatever kevin's saying cut right in half he grossly exaggerates his successes and he buries his failures keep going kevin so let me tell you this is twice as successful as i thought it was going to be and you're full of and you know barbara you are so full of poo poo it's ridiculous the only reason barbara i want everybody to know that's here no don't do it yes the only reason barbara is where she's at is i bought her a new broom that's how she got now barbara let me tell you the story of blue land talk about a pivot wonderful woman entrepreneur she was facing a complete complete shutdown of her sales because all of it was set to go into big box retailers she pivoted she bought remnant cable time on comcast and she and i made a commercial for her and she made several others and all we did was sell direct at full margin she is way ahead of budget and she hasn't sold anything for the retail well you know she had to put that money out and take that risk she deserves success something new yeah buys detergent online now everybody's doing it that's the whole thing of course well it's delivered to your door not a bad thing and it's done quickly as well right yes exactly are you ready to take some questions from our adoring audience absolutely wait to ask your questions let's go let's see what we got i have like quite a few good ones coming and keep them coming in okay and the first one is can oh can my boss make me go back to work if i don't oh hold on look at that barbara i'm back it depends it depends what states you're in some of those are state mandates some of them are municipal and county mandates there's no federal mandate that determines whether you can go back to work or shouldn't this is determined by where you're at because right now in florida i don't think anybody with that has their head screwed on right is asking you to go back to an office when 20 of the people walking around are testing positive so dave county is effectively shut down that's a good example and there's other places like vermont and even boston now where people are going back to the office because they feel safe depends on the region well kevin this is for marian in florida i realized miami actually where you just left what about there no way to force her back right no no in fact um in our in our uh building where we hire 21 people we've had you know and i'm obviously close with them we've had several meetings about people's comfort and we've gone to a full n95 mass protocol everybody in the building outside of their unit has to wear that mask and and gloves and uh they come in voluntarily to work if they come in they get paid and so um and they're all coming in because we have a really super safe protocol there's a there's another question that's so similar it's probably the other side of that which is uh if i go back to work and i'm not comfortable must i wait it's not really worded well but basically the question is can my boss insist i stay if i'm not comfortable good question you know i'm i telling everybody nobody is going to sue you for taking care of yourself and if you're not comfortable do what your heart says because you do not want to contract this virus it's coming out clearly in the press lately that it's not a respiratory disease it's a blood disease it's affecting people's organs it's affecting their heart rates it's affecting their oxygen intake this is a nasty bug and we don't want to get it just do what you think is safe and don't be foolish i mean wear a mask look at the countries that have got out of trouble switzerland 8 million people only 14 cases everybody wears a mask i don't know why we're not doing that we're nuts oh we don't particularly have people leading us in that direction i don't think either do we let's get let's not get into politics no we're not going to get into politics i'll leave that out as i always do um i i ran into a shopkeeper this morning has a little bistro on madison avenue a tiny little shop guy has three employees uh and he's working alone as i went in for my coffee today i said hey where where are your employees he said i can't get them to come back to making more money on unemployment than coming back to work he said so i'm working the shop myself he had a line of people that he couldn't keep up with what do you say to a guy like that yeah i actually have some companies that said that's happening to us in my shark tank portfolio 80 of my companies qualified for the ppp and got it and the 20 that didn't get it didn't have their accounting and payroll records um up to up to date so that's a new policy i'm going to make a change on everybody's going to have to get an accountant before i close a deal because that was a big loser but what i learned is this this person is absolutely right um in states like california like new york like florida and texas the unemployment is better than working and we've got to fix that immediately because that's kind of stupid that's counterproductive the ppp money was to to give them uh and maintain their jobs and we're finding they won't even come in because the unemployment's a better deal what's your advice to that guy my advice to him would be to go back to work go back to work take the job because at some point that whole unemployment game is going to be over and he'll be without a job he should keep his memory um intact with his boss and his infrastructure work safely obviously maybe remotely the dis the difference is about 11 barbara between which is a lot i understand you're 11 percent better off with the unemployment than the ppp but with the ppp you have a job you're actually employed so you might have other benefits like medical and other and dental insurance and things like that it's really confusing me too many numbers i'm getting a headache just listening basically basically take the job if you get if you can get it that's what i say well you know what i'm going to what i said to the boss and i'm going to share your advice but i think he's already going to be taking mine by tonight i said to him call your three employees and tell them as of monday they're going to be replaced if they don't want to come back he said i'll do that i'll let you know on monday what happens and they call me the nasty one look at you barbara no i mean you just have to size you have to give a deadline i think oh boy that's nasty okay one last one i just graduated from college and i'm really worried about the job market how do i stand out for the millions of people looking for work now good one oh listen i've had i've been asked that question by the way it's a good chance for me to promote my ask myself don't promote just answer them no no because i answer this question every week on ask mr wonderful my youtube channel and i'm definitely promoting it barbara why would i do this why would i do this for free for you unless i'm promoting something are you kidding but anyways the answer that question is interesting because i've had lots of results from this now having been doing it for five months write a letter no more than three paragraphs explaining why you can help that person that you want to get a job at get their job done faster and ask to work for 90 days for free for nothing in an apprentice or internship position just getting in the door is ninety percent of the challenge if you deliver any value during those ninety days you will get an employment you will get a job because right now businesses are freaking out trying to figure to do things like how do i get online how do i deal with social media how do i communicate directly with customers if you're young and you know how to use social media that's a skill that many companies that are old school are trying to hire for but they don't know how to do it and so you're willing to go do it for free for 90 days you take over their social media you show you can how you can acquire customers economically bang you're gonna have a job i see okay well i'm gonna listen to that advice and share it and make it my own say i came up with the idea what do you think about that well barbara i'll show you immediately that'll be good press you might know too that the job boards have gone up by almost 35 in the last week alone so the number of job postings has skyrocketed and of course all all types of businesses so there are many many people hiring right now i think it's almost the rumor out there is there's no jobs no jobs and you know better than most kevin that whatever's in your head your own attitude what you envision kind of comes true so if you kind of think instead there's lots of jobs how do i get the job versus it's not much going on it's a much better posture to shoot from don't you think yeah i agree but you you mentioned the platforms that the number one growth platform in terms of activity right now is linkedin make sure you have your linkedin page you know as they say oh courant in other words go groom it and the other thing i keep telling people about that you the whole linkedin thing less is more no one's going to read 15 pages about where you went to high school in the name of your dog no one gives a put down what you can do to help an employer be more efficient and there's so much demand around digital around social media around direct to consumer around skill sets on facebook or shopify or any of these platforms people are screaming for employees that know how to work that stuff what would you say to people who are just a last question i know i promise you the last one was the last here's one more i'm making this one up but it's a it's a it's a theme that runs through so many of the questions i get how do i keep my attitude up and ready how do i keep myself above water how do i keep myself optimistic i'm starting to feel depressed that kind of thing how does somebody get themselves up you know mr wonderful what do you say yeah you know i have lots of employees i've talked to this about because they have been working remotely now for almost five and a half months in some cases in very small condos and apartments um that's tough to do after a while i mean you know and if they're single and things like that the number one thing is not to run out of money um you get if you want to really get depressed get to a place where you're basically bankrupt because then people run out of money yeah i know but the thing is most people i found because now it's a real life situation are able to cut their expenditures by 30 percent even 35 even 40 by just buying the essentials many people have stopped paying rent you mentioned that earlier that's true landlords are being flexible because they can't sue every one of their tenants but you have to be careful that it doesn't trash your credit rating going forward it's better to notify the landlord that you've lost your job than to surprise them by not paying them most of them are willing to take less when you're when you're forward about it but and the other thing i keep telling them is this is a chance in your life to reflect on things read the book you've always wanted to find a hobby that you know learn how to play guitar or an instrument try do the photography you bought the camera for that you've never picked up whatever that is you've got to find something to do with your your idle time or you'll just go nuts those are the things i recommend those are the left brain kind of things that i would hope you would recommend because you think so so cleanly on all those types of issues i'm going to give a little uh right brain advice here which is i think the best thing about uh us all wrestling through this terrible chapter has been it's given us pause to evaluate who we want to be when we grow up i don't care what age you are it's also given us pause uh to to actually sit and find our own confidences our own confidence and most of the people who are losing confidence right now i find they're losing their confidence because they're not trying things and yet many people think you have to succeed to get confidence but i find all the young people that get confidence in themselves more than ever get it by trying and so i i'm a big proponent of just trying everything you can possibly try because what you wind up with as you come through this difficult chapter with more confidence that you went in with and if you really want to get ahead in life you know it kevin i know it uh confidence often comes out of failures and tries but it's the confidence that keeps with you for life look how cocky you are i mean how did you get that cocky not because you were successful at everything you did i see you do many things that you don't succeed at but boy oh boy do you keep coming back and trying would you agree with my kind of emotional advice on that one kevin yeah so i think that's great advice for anybody that's feeling down i mean you everybody has to find that thing in life that they love doing that they're passionate about that they're willing to work 25 hours a day on and i've always said that you have to try a lot of things before you'll find out what that is you can't know till you do it yes um i'm i'm very concerned that colleges aren't going to have uh classrooms people together anymore which is why they're seeing record amounts of people moving back to the town that their college is in even though there's only virtual classes because they need to be together and i think that's important but the number one thing barbara i think we should leave on that i have begun i'm not leaving on any number one thing you're saying i'm leaving this on the number one thing i'm saying go ahead well i'm i'm going to give some great advice here barbara and then you should do exactly what i say as you always should you know that's the key i mean thank goodness i'm there on shark tank if i let you to your own you would lose all your money it's just ridiculous go ahead anyways here's the thing i've learned from all of this um better be good it is very good you know there's a you have a certain responsibility to yourself and your family and your friends to start acting um safely about this virus it makes no sense to me anymore that when you go outside you wouldn't wear a mask or when you go to someone's house you wouldn't wear a mask i don't let anybody come here anymore that isn't living by that edict i have masks for them i don't want anybody to get sick but i've i now know many people that have gotten the virus this is the difference from five months ago and the outcomes in some cases have been horrific including death and so i am now note to end on it's just it's a positive thing that we can lick this thing if we all get responsible florida's in the mess it's in because nobody was wearing a mask like i was practically the only guy going shopping at fresh market with a mask on people were looking at me like i was a weirdo or something now look at them yes now that now they have to wear a mask and i think that's the i want to just give that note think safely social distance wear a mask you don't want to get sick it's crazy my last comment is it's a wonderful time to start a business um most of the most successful people i know started on the heels of a failure a bad chapter because the whole world gets redefined people are open to new ideas new businesses new ways of doing things so while you're listening mr wonderful and putting your mask on uh remember if you had a dream about starting a business now is the time to get it going that's it don't say another word kevin don't no barbara that's such good advice i'm gonna get you another new broom if you like that video wait do you see my next one don't forget to click right over here and subscribe

Channel: Kevin O'Leary

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Id: zEha3GMATeM

Length: 27min 13sec (1633 seconds)

Published: Mon Mar 15 2021