Reducing Risk in Multifamily W/David Priest
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Episode Description
Welcome to the On The Rise Podcast! In this episode, Jeremy Dyer sits down with David Priest, a veteran real estate professional who has closed over half a billion dollars in mortgages and now focuses almost exclusively on capital raising and passive investing in multifamily syndications. David shares how transitioning from single family and mortgages into multifamily required a complete mindset reset—and why many investors underestimate the learning curve. The conversation centers on risk reduction, conservative underwriting, and how experienced operators think differently about returns. David also explains why humility, fixed-rate debt, and immediate cash flow matter more than chasing outsized projections. This episode is essential listening for investors who want to protect capital while positioning themselves for long-term growth.
Summary
Tip #1: The Best Way to Make Money Is Not to Lose It
“The best way to make money in real estate is not to lose money.”
David approaches every deal through the lens of downside protection. Rather than chasing home runs, he prioritizes capital preservation, stable cash flow, and risk mitigation as the foundation of successful investing.
Tip #2: Experience Beats Perfect Track Records
“When someone says every deal has gone perfectly, that’s a red flag.”
David looks for operators with eight to ten years of experience and full-cycle exits—including deals that faced challenges. Transparency and lessons learned matter more than polished marketing narratives.
Tip #3: Fixed-Rate Debt Is Non-Negotiable
“I only do fixed-rate debt.”
Floating-rate debt introduces unnecessary risk, especially in uncertain rate environments. Fixed-rate structures provide stability and predictability, which protects both cash flow and investor capital.
Tip #4: Cash Flow Must Start Day One
“If it doesn’t cash flow day one, it’s a no-go.”
David avoids deals that rely solely on future value creation. Immediate cash flow provides margin for error and allows operators to weather market volatility without distress.
Tip #5: Conservative Underwriting Signals Strong Operators
“The most seasoned operators have the most conservative numbers.”
Operators with modest projections are often more capable than those advertising outsized returns. Inflated rent growth and aggressive exit assumptions often indicate inexperience or fundraising pressure.
Tip #6: You Are Investing in a Business, Not Just Real Estate
“You’re not investing in real estate—you’re investing in a business.”
David emphasizes evaluating leadership quality, team depth, and vertical integration. Strong teams with shared equity and accountability outperform founder-centric organizations.
Tip #7: Market Fundamentals Matter Before Numbers
“I look at the market before I look at the deal.”
Population growth, job growth, landlord-friendly regulations, and limited new supply are essential indicators of long-term stability. The numbers only matter if the market supports them.
Tip #8: Tax Benefits Should Never Drive the Deal
“Never invest in a deal just for tax benefits.”
Depreciation is valuable, but it cannot compensate for a weak investment. David cautions investors against prioritizing write-offs over deal quality and sponsor execution.
Tip #9: Today’s Market Favors Patient Capital
“This might be the second-best buying opportunity of our lifetime.”
With multifamily values down significantly from their peak, David believes disciplined investors with strong operators are well-positioned for the next cycle.
Resources and Links
YouTube Channel and Masterclass
David R. Priest YouTube Channel (5-hour passive investing masterclass)
Social Media
LinkedIn: https://www.linkedin.com/in/davidrpriest/
