Do you like investing in hard assets with 13-20% IRR? Learn how to do well and do good with clean energy investments that provide similar returns as multifamily real estate. Listen to Nasa pilot Dan Heaney and clean energy fund manager Micheal Euperio workshop how to invest passively in profitable clean energy and how to build a 1 megawatt solar farm end-to-end.
What happens when you get a NASA pilot together with a clean energy fund manager and MF syndicator? A whole lot of inspiration to build a better future for our kids and SOPs.
Yes, step-by-step details on how normal people like us can invest into renewable energy projects either passively or actively and take advantage of the tailwinds behind solar and be at the front of the Green Wave.
Micheal Euperio is paddling out front on that wave. His company Redeem Investments breathes life into old apartments to rejuvenate the community and now massively making impact on a clean future by raising a fund that works with minority business enterprise developers on a utility grade solar farm.
Dan Heaney doesn’t let the status quo define him, on his conventional real estate search he noticed empty land and thought, why don’t I buy it and put a solar farm on it? No tenants, just PVs. He’s in full R&D mode now, there’s no stopping him.
Stay tuned to the end where we digress into treacherous but amazing mountain bike trails and taking a break from being a tourist and simply drinking beer on the beach with the locals is the best part of being on vacation
I’m a total beginner on this but you’ll see it’s not all that different from investing in commercial real estate as a private lender but with a whole lot of government subsidies.
I know we’ll be hearing a lot more from Micheal and Dan in the future.
Michael Euperio is COO of Redeem Investments, West Point graduate and multifamily syndicator. michael@redeeminvestments.com
Dan Heaney is an aspiring solar farm developer and Nasa Pilot.
Supported by Aspiration Bank & Sustainable Investors Group
Thanks so much to Dan and Micheal for helping me dive deep into the topic, I’ll admit I really didn’t understand how you can act as lender for solar projects and stay outside the equity position on a depreciating asset like equipment.
I had a blast learning about this and in conclusion:
Solar has huge tailwinds and we should paddle out on the front of this green wave for a diversified portfolio resilient to climate shocks.
Seas to Swim In: Solar Lending
Solar Lending: For predevelopment/development: the Fund has a 15% IRR with a 3 year exit plan. Sounds pretty good. The utility company will hold the asset and reduces risk on maintenance.
Paris Agreement: Solar is likely the most profitable short term solution to meet our energy demands to limit global warming. Many approaches are needed though.
Mountains to Climb: Solar End-to-End
Complexity: Without experience it’s tough to sort out all the technical details, partnering with an experienced operator would be helpful to avoid costly mistakes.
Initial Investment: land needed is about 2-5 acres per megawatt. 85-95 cents per watt is a good build price.
Thanks again to Micheal and Dan to help us unpack this on our Summit Roundtable.
Book Recommendations: Traction, Climate Wealth
Learn how your green can grow more green for your portfolio and the planet! Visit us here for everything you need to know: www.sustainableinvestorsgroup.com
Schedule a call where we can discuss your investing needs, outdoor adventure plans, or just to get to know each other.
Special thanks to Dan and Mike for taking the time to share so many great insights with us.
If you enjoyed this podcast, there’s a couple of things we need you to do right now:
Then, please share the show with whoever you think it will inspire.
Until the next time, Climb Your Mountains.
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Workshop on How to Invest in Profitable Clean Energy
. [00:00:00] All right, fellas. Welcome to the summit round table, a show for outdoor lovers. Curious about the connection between purpose and profit and today's round table. I'm very happy to connect Michael, your Curio full-time real estate investor, and C O O of redeem investments and a veteran.
And I'm connecting him with Dan Haney, husband, father, pilot, and investor. And today we're going to go over the topic of how to invest in profitable, clean energy at scale. So Michael, welcome [00:00:30] to the show. Hey Morgan, how are you? I'm good. I'm good.
So I just want to dive right in. I want to know what is the GreenWave. Yeah. You know, I mean, we're in a political environment right now, we're hustling having to address climate change. As far as, you know, what we're trying to be as, as a country, um, as, as a global economy, you know, we're trying to get the folk levels of global warming of two [00:01:00] degrees Celsius by 2050.
Right. So that's the whole Paris agreement. Hey, can we get to a hundred percent clean energy by 2050? , obviously there's a lot of incentives out there. Uh, a lot of money flowing into sustainability and this green wave,
But, but effectively, there's just so much support for. Clean energy. Right. And so it's, it's a way that we're trying to ride. I mean, I think there's a ton of tailwinds behind it and we're just, , trying to [00:01:30] take advantage of, some legislation, some executive orders and just the support for, for sustainability initiatives right now.
Yeah, that's fantastic for people that aren't so familiar with, you know, investments in energy, but maybe they're familiar with real estate. Can you kind of explain what are the similarities? What are the differences? Yeah. I mean, that's a great question. I mean, in all honesty, there's a ton of parallels around real estate and energy infrastructure.
Right? If you think about it, they're both [00:02:00] hard assets, right? One happens to be buildings, land, you know, it could be schools, infrastructure, or whatever else. Right. But, renewable energy. I mean, in all honesty is, is infrastructure in itself, right? I mean, you have solar PV panels that can be spread across.
Yeah, hundreds of acres. Um, and you could have urban wind, you know, that's supposedly a trend that we're seeing here more recently where not only do you have offshore wind or wind [00:02:30] in land, but having wind, you know, in urban areas. So I think DC is a very good example. We're in wind could be a trend here pretty soon.
And so, I mean, at the end of the day, you know, a lot of it is, is very similar in the sense that it's, it's a hard asset. you know, you're, you're thinking about doing land development, right? If you're looking to, to build a solar farm, uh, I mean, there's obviously. Land survey items that you have to do, there's permitting.
[00:03:00] frankly it's a little bit easier, I would say, say too much easier, but certainly, not as difficult as far as doing a commercial multifamily building as an example, right? Like you really could just partner with, uh, any PC vendor or supplier EPC is engineering, procurement, and construction. Uh, but they do it kind of soup to nuts with regards to.
Pickering the panels, procuring the equipment, the technology, uh, doing a lot of the engineering work behind it and then actually [00:03:30] constructing it as well. Right. So, lots and lots of parallels. And the good news is, is that you don't necessarily have choose one or the other right now. What I mean by that is there's a lot of people out there that think, oh, you know, well, in order for me to get great returns, You know, I have to invest in a project that doesn't necessarily do well or do good for the environment.
And that's absolutely not the case. Right. You can, you can certainly invest in and renewable energy projects, solar specifically, where, [00:04:00] you know, Hey, it's just like a private money loan or a hard money loan or an equity investment in value, add multifamily. So lots and lots of similarities for sure. Right.
Right. So with some of these larger projects, could you basically make it similar to like a cynic multifamily syndication model where you have multiple passive investors and, uh, and a GP team that's sort of figuring it out. Absolutely. , it's a great parallel there.
w one thing that we're doing at redeem, uh, we actually just recently launched our renewable energy [00:04:30] fund. effectively we have a. For a farm developer partner that has a large, large capital need out in the mid Atlantic and east coast region. And they're developing utility grade utility scale solar projects for large utilities out on the east coast.
they need pre development development capital to kind of get them to a construction loan. Right. And so these construction loans we're talking. 150 million to $200 million projects. Right? So these are even larger than some syndications out there that you see their class a [00:05:00] and the. You call it 60 to a hundred million dollar range.
but really what we're doing is we are providing pre-development capital development capital to get them to that construction loan from, uh, a big institutional bulge bank, like a US bank or Wells Fargo or PNC national bank. but absolutely. Yeah, we're pulling together funds. Uh, we're providing those funds in the form of a private commercial loan at a very favorable interest rate.
I guess the punchline is, is to the degree that you want [00:05:30] to. No investing in syndication, a real estate syndication, or multifamily syndication, and looking for those returns in that 13 to 18% or up to 20% IRR range you can get very, very similar equity-like returns in a structure that's really debt. and so we can talk about that more a little bit later, but, , that's the mission at Redeem investments is let's find above average returns for our investors and provide that with below average risk and really [00:06:00] mitigate against risk and volatility in the current stock market right now, that's really great doing well.
And doing good is definitely the motto of our show here. So finding opportunities or shining a light on those kinds of opportunities is really important. I'm not sure that a lot of people understand that these opportunities. Do even exist. So it's really great. Your team's doing that. Can you share a little bit more about redeem and your, your teammates there?
Yeah, I mean, Regina has been around for a few years now. , [00:06:30] I actually just joined recently over the last couple of months. Uh, so absolutely ecstatic that I, I just left the corporate world with my W2 behind me in the rear view mirror. , , and frankly, redeem. , that it start really multifamily, multifamily syndication.
And so collectively me and my partner, we control, uh, about 170 units between Colorado and Texas. Uh, probably five 17 million assets under management, uh, spread [00:07:00] across five communities. And. Uh, yeah, so we get really good, our start in multifamily syndication, but going back to our mission, uh, kind of our core value it's to provide great opportunities, investment opportunities for our investors with above average returns and no below market risk.
and so it really providing those asymmetric returns and recently got, got approached by one of our. Partners, kind of an advisory board member. Uh, basically it was like, Hey, you know, we [00:07:30] have a relationship with a minority business enterprise certified developer, in the mid Atlantic region. Uh, that's doing these projects and they could really use pre development development capital.
You guys seem like you're, you're pursuing these types of opportunities. So you guys should do some diligence around that. Right? So we've expanded our scope of just doing multi-family acquisition, syndication to other investments, opportunistic investments that can provide a great return, but also, you know, do well and do good.
As you mentioned. [00:08:00] Yeah. And also just taking a look at, , redeems, partners. It doesn't look like your typical, fund management team. , it seems like quite a diverse group. Yeah, that's a really, I mean, in all honesty, You know, my, my partner, uh, Christian control and, uh, he comes from the healthcare industry.
Um, and there's obviously a lot of, I mean, healthcare is a big user of renewable. Um, you know, I've been in the tech world for the last decade. Um, my, my first [00:08:30] what's funny is my first. Uh, kind of MBA internship. Um, you know, one of the big things that I did back at in grad school was there was actually a MBA intern slash analysts for a venture capital firm that invested in green consumer products.
Right. So, um, Eagle products, I don't know if you're familiar with, you know, the compostable cups and plates utensils. Uh, I mean, that was one of their early investments, so they they've done very, very well. And so frankly, [00:09:00] um, I've always had an interest, um, in sustainability and renewable energy. Um, I decided to go to tech, you know, post grad school and toast my military days.
, but yeah, definitely a nontraditional route.
So really wanting to give back to the community. That's great. Can you share one of your earliest memories of being passionate about sustainability? Yeah. You know, I mean, I think, um, I mean I mentioned, I went to grad school.
Uh, I grew up in Texas, uh, you know, went to west point for undergrad, [00:09:30] ended up in Colorado, uh, for my military time. Uh, and then I essentially went to the university of Colorado Boulder, uh, for my, my graduate degree and an MBA. Right. And there was, there was an energy program, uh, I mean, obviously. Boulder is known for, for being very progressive when it comes to sustainability and just, um, thoughts about renewable, renewable energy in general.
And so, I mean, honestly, it's later in life, uh, to be, to be [00:10:00] Frank, to be honest. Um, but in my, you know, my late twenties, I really just discovered, you know, Hey, we, we really need to do something, you know, about. Or usage of fossil fuels.
So I was just in an environment, whether it was academic or not. I mean, I was just surrounded by people that were passionate about it. And so it was always kind of a trickle down effect of, Hey, if you're around these types of people, Um, you know, everyone always says like, you know, you are who your social circle is, right.
I just that 120 to [00:10:30] 200, very, very close MBA classmates that were just very passionate about it. And so I kind of do that, not to say that I had to, I just said at least became more cognizant of it at the time. Yeah, definitely. What the average of the five people you hang out with the most. Absolutely. Yeah.
And I think my best friends, um, you know, during the, the. Grad school program where focused on energy finance and entrepreneurship. So those have always been my passions, finance, and entrepreneurship, and merging those [00:11:00] two. But you know, obviously energy on top of that. Um, and sustainability is, is a great, great cause.
Yeah, it seems like a false dichotomy to say that, you know, you can't pursue entrepreneurship and profits and sustainability at the same time. It's unfortunate. Sometimes that's the thought process. What's funny is I actually haven't had a chance to read it yet. but one of our advisors on our board, uh, basically said, you know, Hey, you guys should really look into to jigger Shaw, who is the author [00:11:30] of climate wealth.
And basically, um, I mean, that was his, his thesis and approach was, um, there's absolutely no reason that. You can't think that you can get solid returns, um, you know, within clean energy or, sustainability initiatives. Right. In fact, that's, that's probably one of the greatest opportunities of our generation is that, you know, there are, there are some big, big opportunities when you intersect those two and.
Uh, you actually have to take [00:12:00] advantage of that.
So he actually just recently got appointed jigger dig to, Be the director, I think of lone energy programs for department of energy. Right? So he is continuing to make an impact, not only on the private side, but in the government side as well. Fantastic. All right. Well, I'm going to switch over to the other side of the round table and introduce Dan Haney.
He's a husband, father, pilot, and investor. He's the kind of guy that says, you know, I'm flying for [00:12:30] NASA this weekend. I might be late to the call. Hey, Dan. How are you? Good. Thanks for the introduction. And I appreciate you having me on definitely. It is. It is. Can you share a little bit about your background with work and investing?
, so I'm really an absolute newbie when it comes to investing. Uh, I just kind of got the, uh, real estate book through one of my friends, Adam Whitney, who is actually a part of our war room as well. And every time he was coming to visit, he was just raving [00:13:00] about real estate. And so, you know, I caught the bug, I started looking into it.
And we talked about, uh, me getting solar on my roof and I was kind of, I'd say my first investment into like, renewable energy and I can see the tangible difference.
And so that was really cool for me. And that really is what kind of like perked my interest and looking and exploring, you know, opportunities, uh, potentially, Building a solar farm. I know I was driving [00:13:30] through Palmdale, coming back from flying with NASA and, and I, uh, I noticed some solar farms, uh, just along the road.
Cause I, I took the back way going through a canyon and I was like, wow, there's so much open space out here. I feel like there's, there's maybe a market, there's a market maybe that I could get into. Um, so I started looking at land and, you know, there's, there's plenty of land out there. And what I think is reasonably priced, you know, 10 acre, lots that are like perfectly [00:14:00] flat and next to electrical lines and access roads.
So, yeah, so I'm just, I'm excited and, you know, looking to learn, and I think it's an awesome opportunity to speak with Mike and, you know, someone that's done it and, , someone that's come from. Military background and it's, it's cool. It's cool to see someone else that's done it.
Uh, So, yeah, long-winded answer. Uh, but that's kinda, that's kinda how I got interested. So yeah, I remember you going through a business case analysis of [00:14:30] land and sort of pricing out some of the materials you would need to kind of do it yourself. , one of the interesting thing about. Um, Mike, is this idea of it being in a fund.
So it's a little less, hands-on, bit more passive, especially for really busy people with, with jobs and lives and kids and, and all of that. So I'm also really interested in learning more about that too, because sometimes I think you feel like you have to kind of do it all yourself, right? Yeah. Yeah, absolutely.
Well, we like to get to know our guests a little bit. So can you [00:15:00] share what role the outdoors played for you as a kid growing up? Uh, I was always outside. I was, I was the typical eighties, baby.
Uh, I stayed outside until the lights came on and even then I was always pushing the envelope. so the story before, yeah, I mean, you know, I was always into sports. I played sports year round, whether it was football, soccer, lacrosse. Um, it was, it was just sports nonstop basketball with the friends. Uh, hockey, it didn't matter.
Like if [00:15:30] it, if it was a sport I was doing it. Uh, and I was also really just kind of adventurous. Um, I remember, you know, taking a thermos and picking it up, uh, with SpaghettiOs and meatballs, putting in a little backpack and I was gone. I was going on like these, these hikes, like out into the woods where I had no business being, um, you know, down to the water, which was probably, you know, looking back on it probably about 10 miles away.
And I was doing this, you know, as a kid, you know, [00:16:00] but, uh, you know, it's always been at the, I love it. I love it. And like, I always like, I'll take the kids out for walks. We'll go down to the Creek. You know, let them chase tadpoles around, you know, just yeah. Simple stuff, right? Yeah. Yeah. It is. I think it's so important.
Um, I think they need that experience. Um, and you know, it's, uh, you don't, you don't always see that today. I think there's a little difference with kids kind of. Being outside all the time. I think a lot of things have turned [00:16:30] into technology and video games and, you know, there's a lot of other things to keep you busy.
Um, and, and, and what a lot of people perceive as a safe environment. So, yeah, yeah. That perception is, is interesting. Right. I know perception is reality where we're all military, so we get that, but, uh, there's some repercussions for not being outside, especially as a kid like that. Being able to take risks and be calm and [00:17:00] get that, um, that sort of benefit of being in nature.
Right? Yeah. No, I agree. I agree. I think it's important. Well-rounded that's what I always teach my little guy. You gotta be well-rounded man. Absolutely. All right. Well, this is my favorite part of the show. I'm going to step out and just let you guys take it from here.
Mike. Well, thanks, dude. Thanks for taking the time. Uh, super excited to talk to you. Um, I guess I will start with, uh, what really, uh, got you interested in [00:17:30] pursuing, uh, renewable energy. What, what really got you excited about it? Yeah. So I think for us, um, you know, we didn't just want to be kind of like your everyday or. Every every body syndicator, right? Like, I mean, not to say that there's a lot of cookie cutter syndicators out there that are all looking for the same kind of IRR returns and saying, Hey, we're doing value, add multifamily.
Um, you know, for us and for me, [00:18:00] um, I mean, even if you think about the name of our company redeem investments, right? Like there's, there's a higher purpose there, right? We started as a multifamily syndication company, real estate investment and acquisition company, really trying to redeem properties. Right.
And bring new life and quality to, to the community there. Um, you know, and, and frankly, because that was our investment thesis and approach, um, opportunities just start popping up. Around being able to give back and do something of service. Right. And so [00:18:30] for me, the Genesis, once again, behind leaving kind of the corporate world, there'd be two jobs.
I was getting tired of the day-to-day grind of. Being in meetings all day and, um, not being fulfilled on a day-to-day basis. Right. And so for me, really, you know, we talk about the, why a ton, um, you know, for me it was an opportunity to give back. Right. And so, uh, you know, renewable energy. I mean, obviously there's some tailwinds behind it.
Um, lots of great initiatives, [00:19:00] uh, what we call it, the green wave. Right. But, um, yeah, I mean, I think. In all honesty, like, you know, getting to 2050 and trying to be almost a hundred percent clean energy by then, or a hundred percent clean energy by then. I mean, it's a pretty tall order. Right. So we can't just, I mean, if you think about it, I think we're, we're right around the same age.
Right. But if you think about 2050 is really only what 29 years from now, right? Like you don't have to think about the early nineties. Different [00:19:30] technology was from the early nineties to where we're at now and then going from 2020. To 2050, and then trying to be a hundred percent clean energy. Um, I mean, it's going to take a pretty, pretty big lift, I think, on everyone's part to get there.
And so, yeah, I mean, I want to be a part of that. Our company wants to be a part of it and we also want to help others be part of it as well. Nice. Nice. Yeah, I think, uh, the why is kind of a big thing for a lot of people. Me being new, you know, I don't know that I've [00:20:00] really developed, uh, my why in terms of investing in real estate, a lot of mine has been, you know, family driven kids, like everything changed with kids, man.
Like I. That's one of the reasons I got out of, or I got off active duty was, you know, for my kids, like I want it to play, you know, dad, I want it to come home and be part of that, uh, you know, that growing up process. So right now that's like, that's been kind of my big why. Right. And now I'm starting to like venture out and I'm like, what [00:20:30] else, what else can I do in the world?
You know? And I think this is one of those things where like, you can have an impact, which is kinda neat. And there's an opportunity to not only have an impact, but you know, , financially, , there's, there's benefits there too. And that's, that's cool. I mean, that's kind of like the, the win-win right.
So it's pretty neat. Um, So, I guess, uh, one of my other big questions is what are some, what are some lessons learned? What are some things that you learned [00:21:00] along the way that you think would be important for someone like me?
That's kind of just getting started. Yeah. So you mentioned mentorship a little bit earlier, right? And you think about the parallel to. Pulling money together or doing a syndication in real estate. a lot of people talk about track record operating history and what your, what your, what your return profile has been in the past.
Right. So I think, I mean, frankly, renewable energy is kind of the same boat, right? , both you and Morgan mentioned that, you know, Hey, I've been at [00:21:30] this. Um, but frankly I haven't been at it for too long. Right. It's anything I'm borrowing. To a degree, our developer partners track record.
I mean, those guys can go back to doing development projects to 2009. They've been involved in over a billion in development globally. Right? These two guys have the two principals at this developer partner of ours. I mean, they have over 50 years of experience doing high scale utility grade projects, uh, for big off [00:22:00] takers, uh, customers.
And so, um, Yeah. I mean, we're a strategic advisor and partner to them around capital bringing pipeline and new projects into the mix. But I mean, at the end of the day, um, I mean, they're almost kind of our mentors as well, right? Like, um, we're just 10 degree along for the ride around learning from them.
I've really ramped up the knowledge around solar farm development here, you know, over the last couple quarters. Uh, but I can tell you that, , when I was sitting in your shoes, just, just. [00:22:30] A few quarters ago. I knew what a solar PV panel was, but, but yeah, I knew it looks shiny on my roof.
Cause I just, I did the same thing where, you know, I did solar in December of 2020 and you know, it got the whole sales pitch of. No. Hey, installing solar in your house is really just a, a bill replacement. You're you're just taking, instead of paying Xcel energy or the local utility, 90 to $110 a month, why don't you just invest in solar on top of your house?
[00:23:00] Um, so we got fed in this some similar parallels on the, on the commercial side, but yeah, going back to. You know, finding latching onto mentor lettering, that experience kind of that crawl walk, run phase because frankly, you're not going to hear a lot of people go right into large scale development, building a high rise in the middle of downtown Austin for their first project.
Right. And so I'm with you. [00:23:30] I mean, obviously, you know, You're, you're a smart guy. You can surround yourself with the right people. And there's also lots of motivated people around you. And so, um, I would say , definitely continue to leverage that network. I mean, the word room and our veteran real estate investing group is, is, is a great resource.
Awesome. Yeah. And that, that's almost like a perfect segue into my next question is, uh, talking about partnerships and building a team and you know, what are, what are some things that you've learned and. You know, maybe [00:24:00] some takeaways from that as far as maybe personalities,
uh, it just really just kind of team building and like building, building, I guess, the. You know, a group of investors, if that is maybe probably I'm thinking in terms of what I'm going to be doing. Um, I'm assuming, you know, I'm probably going to need maybe a partner and then find investors and just really, I guess how they go about that, aspect of it.
Yeah, and I mean, in all honesty. So let me start with my company first, [00:24:30] right. Redeem investments. you know, my partner, Christian, uh, you know, he and I have actually only known each other, uh, going back to probably the summer of 2020, and we really started to get to know each other and have those daily conversations starting kind of in the.
October November timeframe of last year, but we didn't meet each other. I haven't been like longstanding buddies for sure. Like two decades. I mean, we were both, we went to west point together. We were around there right around the same time. Um, but I didn't meet him until [00:25:00] frankly last year. Um, but the character, the similar values, uh, you know, this is a funny story, but I mean, both of our wives are actually lactation consultants.
Um, and Koch moms breastfeed and knew each other. And we're both like Instagram influencers. Right. So they actually knew each other the whole before he, and I knew each other, which was kind of funny. Um, and so, uh, you know, we both consider ourselves men of faith. Right. And so then alignment around values and just vision is, is, ridiculously important.
Right? And [00:25:30] so, um, we talked about, you know, what we wanted to provide to our investors. Um, you know, asymmetric returns at lower risk. Uh, and so we were just heavily aligned with the fact that like, we wanted to build something big and great, but not because of money. Right. Money is money is a by-product of what we were doing with, with building a great business with one another, when people that we liked.
Right. And so if you think about our team, , we have an asset manager, acquisition managers, we partner with, [00:26:00] a developer who is, , a minority business enterprise certified developer. you know, I'm Filipino, um, You know, my, my partner Christian is, is half black, half Filipino.
Uh, these developer partners that we partner with out on, out on the east coast. Um, I mean, they're one of the largest MBE certified developers in the country. Um, and so there is that net, that common ground there. Uh, but when you talked to the guys, I mean, um, I mean these developer partners of [00:26:30] ours, uh, they're just genuinely good guys that you want to be around and do business with.
Right. And so we always talk about, you know, that airport role, can you. Can you be at an airport with someone for six hours while you're waiting for a delayed flight? I mean, absolutely with these guys, just every time I sit down with the folks at mid flare, um, I just learned something new about solar energy and frankly about myself and how I operate in business.
So it's been really great. Yeah. Yeah. I think that's super important. And I was having that [00:27:00] discussion actually. It was my flight ops manager, uh, this past week is that. You know, they're talking about hiring a couple of guys there at north road and I'm like, you know, I have a guy that I was kind of interested in bringing on and they're like, well, you know, tell me, I was like, he's a good dude.
Like starting with that. And, you know, I kind of explained to him, I was like, I've been in the worst situations before, uh, you know, did some combat deployments and stuff like that. And. You know, it varied greatly, uh, [00:27:30] deployments varied greatly. And one, I was in the worst situation with the best people that I still talk to.
I still have relationships with, um, to this day. And then I've been on other deployments where I wasn't with a good group of people. And it was like, but I was in a better situation, but it was just, it was kind of like a toxic environment. And I'm like, why. This is so much better, you know, and we should be enjoying this and having fun.
So yeah, I, again, I agree, , the people, people make it and having the [00:28:00] same values is, is super, super important. , so kind of switching it up a little bit. Um, one of the things that I was kind of curious about looking at, uh, solar farms in particular is I guess, like the depreciation aspect of it and where.
Well, I guess one of the appeals of investing in real estate is like, there's that potential for building equity in a property where, and solar farms. I see it, you know, kind of a little bit [00:28:30] different. It's kind of like a depreciating asset and it's got a life cycle. Like how do you guys combat that?
Yeah. So I should back up a little bit and mention the fact that like we aren't equity investors, uh, really in a solar farm project. So I talk about the, you know, this large, 150 megawatt project that's going on, um, on, on the east coast in Virginia, effectively that 150 megawatt farm is going to get bought by dominion energy.
Right. And so dominion energy is effectively going to [00:29:00] buy that 150 megawatt project from our developer partner, mid flair corporation. Right. And so, um, I mean, dominion, obviously they're a public utility. They have hundreds of these various different solar farm projects, , they have that, that asset on their books, uh, for us, what we did it is once again, we provide pre-development development capital on the front end just to get it the developer to, um, the construction loan Ryan.
So we effectively had to [00:29:30] have an off ramp. from the project, um, once, once the constructional loan is issued by, big institutional bullet bank, right. So we effectively get that principle back from, from our developer partner once, um, the construction loan is, is put in place.
You build a solar farm. You build a renewable energy project and you sell the power that's produced , by that project at a higher margin. Right. [00:30:00] And so if I can speak in specific numbers, you know, this, this 150 megawatt project in the mid Atlantic region, , it's probably going to cost right around 150 to 175 million to build, um, all in cost to include lane acquisition.
Interconnection costs, cost of capital. , but effectively the power purchase agreement associated with utility, you know, is going to be kind of in the 230 to $250 million range. Right. So obviously there's a [00:30:30] spread there and I mean, all that equity, you know, above the bill costs, , you know, I mean, effectively, I mean, The development team is sharing, in that, right.
And that's, that's a very small development team, but we don't actually share in that equity because we're, we're taken out the four. no, before the equity is actually realized if that makes sense. Yeah. Accumulate interest paid back to us as part of cost of capital for commissioning of the. Solar farm.
[00:31:00] Um, but yeah, we're not participating in the equity. So I guess going back to the parallel around hard money loans or private money that we provide, I mean, we have a promissory note with, with the developer partner at 15%. And so they effectively. Have to pay. I mean, our cost of capital for those that PDD loan is 15%.
And, you know, we take a 20% carry on top of that, the past, most of the profits and accumulated interest to our, to our [00:31:30] investors. Nice. Nice to your question specifically around I guess, depreciation, but, um, I mean, I guess in all honesty, I mean, I, I could follow up with you on that end, that answer, but I don't know the answer to that question.
Okay. Yeah, no, I mean, you guys are kind of, your business model is probably a little different than what I'm looking at. I mean, I'm a little smaller and I'm trying to invest kind of. I'm not going to say on my own, but it's, I'm trying to build a solar farm, but I actually want to [00:32:00] maintain it as well. So, you know, it's just kind of a, a different, different business model, but that's cool.
It's interesting. I mean you're jumping head first into kind of the full project end to end. Right? We're we're on the front end, we learned it on obviously kind of the, the second half of the project where you're doing engineering, procurement, construction, commissioning, uh, I mean, obviously we're involved in, on the front end where there's permitting surveys, soil studies, , you [00:32:30] know, having to do a RFP or RFQ for.
From the APC vendor and we're involved in all that, but I mean, you're, you're jumping in or thinking about jumping in to doing all that by yourself, which sounds like a pretty busy project, monumental tasks. Absolutely. And I'm trying to learn everything I can as fast as I can, but at the same time, it's going to be cautious.
, . So, what are you looking at in your you're out of California, right? Like what, what's the project you're looking at? [00:33:00] How can I be helpful around that? Yeah. So what I'm looking at initially, and this is obviously with limited knowledge, uh, is there is a 10 acre plot of land out in Palmdale and it actually lowered the price.
They initially were listing it for 68. They just lowered it to 48. Um, so. It's it seems perfect, but I don't know what more to look for then it's flat. It's been leveled. Um, there's a road that accesses it and there is a power line [00:33:30] that's running. Literally directly across the edge of the property. So in my mind, I was like, man, it almost looks too good to be true.
Uh, but things, you know, I don't know. And you may not know like the nitty gritty as far as like, what does it really take to connect to a power line? Because I don't know if like there's a certain load, um, that power lines can handle both coming in and out. So, you know, it's, it's stuff like that where I'd probably have to have some kind of engineer.
Uh, take a look at it and develop a plan, [00:34:00] which obviously is going to cost some money as well, but it's kind of a risky take with getting into the business. Um, but that's, that's really what I'm looking at initially. And I know like what I was reading is that you need about six acres or so for a, a one megawatt, system.
it's about what they were, they were advertising that the thing that I've seen it varies a lot is, , just the image structure is, is varying. Um, I've seen, you know, some people estimating as low as maybe [00:34:30] 700,000, you know, all the way up to, over a million dollars.
It's like, all right. So I'm trying to look. At, the rates for the electrical company, what their purchasing power at a wholesale. Right. Which is a raw deal in itself. Um, when you started looking at it, like you are paying so much to bring electricity in and they're paying so little to take electricity back, I'm like, man, it just doesn't seem right.
but talking to one of the guys too, he was like, well, there's other opportunities. You build that project. [00:35:00] And. the, the electric company could bid on your farm as well, but like, I'm such a little guy that like, I don't even know if that's even in the realm of possibility. Uh, so when I'm initially looking at it as like, Hey, if I do one of these in a sustainable and there, you know, if there's any kind of net profit there, then you know, I may look to do more and more until it becomes, you know, a larger scale.
So that's kind of what I'm looking at right now. Yeah. [00:35:30] So, , I mentioned our, our developer partner, uh, doing, or being involved in about a million in development projects. I mean, if I looked at their list of projects when we were doing due diligence, I mean, they've done and led projects kind of as small as one megawatt to three megawatts.
Right. And so in, in the middle east. I say all that in the sense that, um, No. I mean, they've, they've done utility grid projects as well, but, uh, no mean, I think it's great that you're thinking about cutting your teeth, you know, on a smaller project, just so you [00:36:00] can get that experience.
Right. I mean, you hear a lot of people say, you know, they jumped right in and do a. Do a hundred plus unit multifamily syndication. Uh, I mean we started, you know, kind of doing quads and six units went to 12 units gone to 20 units. Now we feel really comfortable and can probably do a hundred to 150 units at this point.
Um, yeah, I mean, I think, I think a lot of rules of thumb that you hit on, uh, you know, are pretty good with regards to, you know, how much land do you need. I've heard of anywhere [00:36:30] from, you know, two and a half to five acres per, per megawatt. Um, if he can target building, um, you know, a megawatt, one megawatt.
Solar farm for, for a million bucks, um, gold costs kind of in that 85 cents to 95 cents per watt range. Um, you know, that that'd be pretty good build costs. Uh, and if you compare that to like other renewable energy sources, like wind [00:37:00] or hydro, I mean, for wind, you're looking at like, I think it's like one 30 per, per lot.
Hydro's kind of all the way up to $5 per watt. And there's honestly a lot of maintenance associated with wind and hydro. So, um, with regards to solar, I think as we move to more renewables by 2050, um, you know, I think solar is going to comprise probably the bulk of the clean. Oh, interesting and [00:37:30] energy that we're providing, uh, with wind, probably being a close second.
But solar has a lot of tailwinds behind it. I think, like I said, if you can start small and get your niche, um, I think you're on the right path. Yeah. And that's the same thing with real estate. Like when Adam started talking about getting into real estate, I was like, all right, well, let me get my real estate license.
So let me learn about this first. and then I did the mastermind group and you know, that's where me and Morgan met. And, you know, it's just, it's trying to build a foundation before I kind of jumped in. Um, I think it's important. [00:38:00] And so now I've kind , , shifted focus a little bit and, um, you know, looking at the solar because the market right now for, you know, a little guy like me for real estate is pretty tough.
Um, especially out in California. Yeah, and I think it should, I could go back and mention, cause I know Morgan mentioned it earlier about being a passive investor in renewable energy projects, but I mean, it's, it's very akin and very similar to being an LP and it's indication reading through the PPM [00:38:30] documents being kind of.
Shoulder surfing and looking over, , the operators back with regards to, okay, what are they doing on the diligence front? Like what are they doing on asset management front? And so I say all that in the sense that, you know, Hey, you know, potentially consider investing passively in a really big project, you know, and, and working with someone to, to be your mentor or at least help you kind of.
Talk me through the process a little bit. Um, cause, cause [00:39:00] frankly you can learn a lot just by Moses and being around the process itself. Yeah, yeah, absolutely. And that's, I think something that's intriguing to me as well. And that's, like I said, that's kind of where I started with the real estate thing. My first, my first, uh, you know, investment in real estate was doing private lending with a storehouse.
And so that again, a learning experience going through that process. Uh, and then, you know, watching, you know, the, I guess the then flip the house cause they, they kind of post things, kind of keep you [00:39:30] up to date through the process. Um, and you know, you just pick up little nuggets throughout and then you get to talk to your team, you know, your mastermind group.
You know, and kind of talk about it a little bit and they they're doing the same thing. So it always comes up in discussion and it's, it's nonstop learning. And, uh, that, you know, definitely might be a thing that I look into and, you know, maybe we can talk, you know, outside of this as well and see what opportunities are out there.
Um, because I, I would love to, you know, find a way to invest, um, You know, [00:40:00] and at the same time kind of pursue my goals outside of that as well. So yeah, there's all these mastermind groups for real estate, but maybe there should be some masterminds for sustainable investing, you know, it's fantastic. Yeah.
Some people want just a little bit more returns, but their return, right. They want impact to be part of it so we could talk forever, but I'm going to wrap it up. So this is a show for outdoor lovers. So I want to hear Dan your best outdoor [00:40:30] adventure. Best outdoor adventure. Uh, you know, I'm going to say just Hawaii in general.
That is my happy place, period. Yes. Yes. Uh, and to be honest, like it was, we didn't do anything crazy, but one of the days that I enjoyed the most at a Hawaii was, you know, my wife is very, like, we gotta do this, we gotta do that. And like, she was like, we gotta see this spot, this spot. It's like, I get kind of overwhelmed by that.
And I was like, I just want to go to like a beach away from everyone. [00:41:00] And. You know, not, uh, be like pressured to do something. And we went to, we found that we were literally driving down the road and I was like, that's it? And we pulled, we fought over and it was us. And there was, I think, three locals there on the beach.
And it was just nothing but us, uh, just my son at the time, you know, so he's running around loving the crystal blue water, um, and the locals were awesome. Totally cool. And they were just [00:41:30] like, they were playing music on the beach, like drinking beer. They're like, Hey, do you want a beer? And I was like, Yes.
And so like it was, it was, it was an awesome experience that sounds of magnificent, magnificent. And Michael, how about you best outdoor adventure, Ted and I love Hawaii too, for sure. One of the prettiest hikes I've ever been on was the island of Kauai. But as far as my. Outdoor adventure. I'd say it's actually probably an annual pilgrimage that I do [00:42:00] with a whole bunch of buddies.
Uh, we call up man camp and I try to make it at least once a year. Um, but there's been anywhere from as little as a handful, like five guys to as many as 25 30 guys, we go out to Moab. Fruita mostly, uh, we switch probably every other year. Um, but I'm a big mountain biker, uh, and doing, you know, doing a trail.
Um, w with some of your best friends in the world, um, you know, it's just such a great experience, right? So I don't know if you guys have been out [00:42:30] to the various different trails out in Moab, it's obviously a great spot. Um, but you know, great hikes with arches out there as well. And it's really, really, really beautiful landscape out there.
It sure is. I actually stopped there when I was moving from South Dakota to San Diego and we went out to the arches national park kind of near that area, but I didn't bring any water. And I thought we were tough enough to do it. And then it hit a hundred degrees. We, I literally was. Carrying both [00:43:00] my children.
And we would hide underneath the sagebrush because we were so hot. They didn't take water. Yeah, absolutely. Take a water on water bottle was not enough for four people. Okay. And Michael, what about a book that changed your mind about something. Yeah. Uh, I mean, it, it's kinda cliche because it's a business book.
Um, but I don't know if you guys are read that book. Um, but Gino, Whitman, , traction. Um, but, but you know, [00:43:30] for me, um, I've always thought of myself as a very polished and disciplined, , operator. You know, but, but just having sort of a framework and a playbook to kind of talk you through, Hey, how do you manage your objectives, your big rocks, how you hire people?
Um, how do you manage your team as far as performance and KPIs? Um, so really just having a playbook around that, um, Yeah. Now that we're smaller private investment firm trying to grow and [00:44:00] scale. I think it's even more important to have systems and processes in place and hire the right people and put the right team in place.
And so I think we definitely have the foundation around that. Um, but yeah, this book traction, uh, wasn't anything new. I mean, being, you know, being a business guy and in the military, A guy, I think a lot of the topics and knowledge was there previously, but just having that outlined in a very succinct format was, was really good for me.
I would agree. He did put it in a succinct way to kind of take [00:44:30] the monotony out of it. Like you put it in really good chunks of information. Right. That's good. And Dan, how about you a book that changed your mind about something? Yeah. Um, one of the books I agree. I think traction is an awesome book. Um, And the, the thing that I liked about it is that it really did give you kind of a model and it really gave you an outline of how to do things.
And you don't see that with a lot of the books. And so I started like everyone else, probably with rich dad, poor dad. Um, and that's, that was like the first book [00:45:00] someone gave me and was like, Hey, you should read this. And that was like the, the mindset. And, you know, I tore through that and probably a few days, and it was, it was just really the mindset and that, that kind of got me started.
But I think traction, for me, it was probably what I took away, uh, or I took the most from just because it really kind of, like I said, lays out kind of a path and outline. You know, just kind of a model to follow. And I like that, like coming from my world, like I like those tangible things. and I like [00:45:30] having a process.
Yeah. I like having a process in place. It's just, it feels comfortable for me. So it's, it definitely does. I agree. Um, okay. Dan, if, if the listeners wanted to get in touch with you about anything, where should they go? Uh, I'm, I'm really, I'm on LinkedIn and Facebook. So, I mean, you can look up my, uh, my name, Daniel Baggini and, um, um, again, I'm I'm on LinkedIn and I don't think, I think I'm might be the first on LinkedIn, so [00:46:00] it might be a simple, fine there.
And then, uh, Facebook, you know, same thing, Daniel Haney. Fantastic. And Michael, if people wanted to learn more about redeem investments or potentially learn more about the fund that you're running, where should they go? Yeah. Um, I mean go to our website, it's just redeem investments.com. Uh, if you want to reach me directly, um, michael@redeeminvestments.com, uh, but always happy to connect with folks want to be helpful.
Um, you know, we [00:46:30] just kind of added the, the renewable energy piece, uh, to our website here recently, or the last few months. but yeah, learn more about our firm, our team, um, and feel free to reach out to me directly Michael or redeem investments.com. Thanks, Maureen. Yeah. All right. Thank you guys for helping us spread the word and tear down the walls between doing well and doing good.
All right. Until next time.