Episode 323: 07-02-15
On this week’s show Alexander Pickens Cordia gives us insight on the near future of the oil and gas investment business. We also sit with Mitash Kripalani and discuss real estate and the CCIM designation, and Jim gives advice to job seekers.
Alexander Pickens Cordia is VP, Business Development, at Republic Resources.
Cordia is responsible for the creation and presentation of marketing and investor materials for future drilling endeavors, identifying prospective investors in various markets, raising capital for the completion of wells, speaking at investor conferences on the state of the oil industry, and maintaining working relationships with invested working interest partners.
We discuss the near-term future of the oil and gas investment business.
Our CCIM Voice is Mitash Kripalani, a senior member of the Douglas Elliman team in Miami as well as a member of the Miami District Board of Directors for the CCIM (Certified Commercial Investor Member).
He specializes in commercial and industrial real estate in Miami’s urban core – Wynwood, the Design District, Midtown, Little River, Edgewater, Biscayne and Doral. Mitash has knowledge in every type of transaction.
We will discuss the advantages the CCIM designation gives him in building his business, as well as his thoughts on the Miami multifamily marketplace.
Finally, Jim gives advice to job seekers all of the time. It’s all about how to get your dream job. Now you get to hear what he tells them on tonight’s show!
Episode 323: 07-02-15 (To download, right-click and select “Save Link As”.)
Jim Fried: All right we’re back we got a great show today, first of all I want to congratulate Wanda Miles on being promoted to Creative Director for the show. High five Wanda. This week we’ve got our CCIM voice. It’s Mitash Kripalani, did I do that right Mitash?
Mitash Kripalani: Yes you did.
Jim Fried: All right high five to Mitash. We’ve got him on we’re going to talk about real estate and what the CCIM does for him, we’re going to have Alexander Pickens Cordia on that’s right T. Boone’s grandson, we’re going to get his insights on the future of the oil and gas business talk about rig count, all kinds of stuff like that and then I’m going to talk to all of you folks out there looking for jobs or how to get a new career. I’m going to give my tips today and talk to a lot of young people and people at mid-career changes about how to get that new career; we’ll talk about that at the end of the show. So Dee are you ready to take us to commercial? The market went down, we don’t care the fourth of July is coming. Out of here.[Commercial break]
Jim Fried: We’re breaking in for a news flash. The Miami Herald reports that D-Wade signed a one year 20 Million dollar contract. We can all rest easy and celebrate now we’re playing the right song. D-Wade, Miami Heat high five.[Commercial break]
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Jim Fried: Hey everybody I know that they’re excited that Warren Henry that D-Wade is back because Chris Bosh endorses Warren Henry and when you’re looking to buy or lease a car you want to get every advantage that you can. My God I’m so happy about this D-Wade thing. When you, then you have to check out Warren Henry Land Rover, Range Rover and Infinity and Jaguar. They’re all exceptional cars they all come with the Warren Henry advantage that means; complimentary dent repair, key replacement, first service. You can even get a personal assistant that you can call for anything anytime for four years. Always the best price, always the best service, always Warren Henry.[Commercial break]
Jim Fried: All right we are on, we are on with our CCIM voice. We’re going to sit down with Mitash Kripalani. He is on the local CCIM board of directors he’s also a senior member of the Douglas element commercial real estate team here in Miami. Welcome to the show Mitash.
Mitash Kripalani: Thank you Jim pleasure being here. Thank you for having me.
Jim Fried: It’s my pleasure now we got to start off with high five to the Heat for re-signing D-Wade.
Mitash Kripalani: Great news.
Jim Fried: Oh All right now we got somebody holding that wants to say, “Hi, Mitash.”
Mitash Kripalani: Okay.
Jim Fried: Dee? Earth to Dee can you bring on the caller, Dee? All right.
Jim Fried: All right Mitash it’s Frank Rodriguez Melo.
Mitash Kripalani: Hey, Mr. President.
Frank Rodriguez Melo: The president of CCIM giving you high five and making sure that Jim treats you well.
Mitash Kripalani: Jim’s doing great Frank, thank you so much thanks for calling in.
Frank Rodriguez Melo: Fantastic. You know Mitash is one of our newest designees. You got designated around a year or so ago, right Mitash?
Mitash Kripalani: Yes, yes that is correct. Last April.
Frank Rodriguez Melo: Magical, last April and Mitash Jim is going to be definitely one of our leaders and I don’t doubt seeing him in either VP or President in the next few years so stay tuned.
Mitash Kripalani: Thank you Frank. Thank you, you got some pretty big shoes to fill you’ve been a great president Frank I learned a lot from you.
Frank Rodriguez Melo: Thank you, thank you, thank you so much.
Jim Fried: All right now Mitash, Frank tells us you just got your designation. What made you want to get a CCIM?
Mitash Kripalani: Well Jim you know, for a —
Jim Fried: Thank you for calling in Frank.
Mitash Kripalani: Thanks Frank. Well Jim you know, being a CCIM gives you a lot of credibility as far commercial real estate when you pick up the phone and the people you call are seasoned and masters. You talk to a lot of very experienced brokers, so just having that CCIM designation behind your name you know really helps you open doors and get people’s attention and addition to that there’s some of the best education and training that I have received from being a CCIM. You know CCIM institutes been around since 1954. Today they have had, they’ve implanted some of the best technology, tools in their education programs, you know?
When you work with the CCIM like my clients, the benefit to them is we’re knowledgeable. We take the time to educate them on what’s going on and what type of properties we’re buying and we differentiate ourselves from the rest of the, a lot of the commercial brokers in our market. To give you an example out of the 125,000 commercial real estate agents in the Unites States, few of them 4% have earned the CCIM designation which is the equivalent to a Ph.D. in commercial real estate. You know, any market you’re in whether it’s South Florida, New York, Chicago anywhere you are look to work with somebody that has a CCIM designation because these are the guys that are battle tested.
Jim Fried: Yeah you know as a real estate investor myself, I always want to make sure I know I’m doing business with somebody that knows what they’re doing and the CCIM make sure that you have the baseline knowledge.
Mitash Kripalani: Yes that is correct.
Jim Fried: The baseline knowledge to get your foot the door but then there needs to be additional knowledge created. You know Mitash why don’t you tell our audience some little bit about what you’ve learned since becoming a designee. Perhaps supplying the CCIM lessons that you’ve learned to analyzing the market?
Mitash Kripalani: Sure. Well Jim you know I’ve learned so much its basically now when I look at a property or a piece of real estate I’m able to understand the financial aspects of the market, aspects of the user and investment. Analysis of it you could explain to your clients whether cap rate buyer or IRR. There’s just a lot of different industry terms that we’re able to share with our clients and when I am presenting my properties I’m able to market them very well.
Jim Fried: Yeah you know you mentioned something about the terminology. What I’ve always found is the toughest thing for somebody when they’re getting in to the real estate business is learning the language.
Mitash Kripalani: Yes.
Jim Fried: You know people say what language do you speak? Well I speak real estate guy language. So Mitash it sounds to me that was a great way for you to learn the real estate game with the CCIM and I guess your applying that now with Douglas Elliman and their commercial division as they build that out here in South Florida?
Mitash Kripalani: That is correct Jim. We have a very good commercial team now. We started in South Florida in 2013, we’re expanding we have 11 offices between Dade, Broward and Palm Beach. We have close to 600 agents. Our commercial division is small but very highly skilled. We have guys that specialize in hospitality, multi families is what I do. We have guys that do retail so we have a really good all-around team of people and addition to that being a part of the CCIM chapter gives me this amazing database of networking and brokers that I can call upon a path questions in the market and what’s going on. So it really puts me in touch of the who’s who of the South Florida real estate market.
Jim Fried: Now I went to your website and I saw that types of properties that you have listed. First of all congratulations on having such a good group of listings.
Mitash Kripalani: Thank you.
Jim Fried: One of the things that I noticed was a lot of the things that you’re working on are really well located multi-family.
Mitash Kripalani: That is correct.
Jim Fried: Now, what do you see in the multi-family market in general and specific some of the sub-market you worked? How do seeing supply in demand for properties?
Mitash Kripalani: Well Jim there’s a lot of demand, there’s not a lot of supplies for it’s a great seller’s market which I tell my clients. There’s a lot of investors looking to do tempt you in exchanges there’s a lot of capital moving in. And if you could position yourself in this specific market and have a property that’s price fairly well you’re going to have a very you know strong response from investors.
Jim Fried: Yeah but with that type of demand a property owner just doesn’t, isn’t benefited by just placing a “For Sale” sign in front of their yard. They need to work with somebody that’s qualified that knows that market and I got to believe that your CCIM and your affiliation with Douglas element really combine to make you a powerful marketing agent for property owners in your target market.
Mitash Kripalani: That is correct Jim. Every owner can put a for sale sign in front of their property. It’s marketing the property, presenting the property, getting it in front of the right people that you need this level of skill for. Working with the right brokers that have these clients so working with the CCIM we have our internal database where we call the deal center, deal exchange. We exchange our properties there every morning I get an email from CCIM’s all across the country that have specific types of property and I market my property to these guys. So just in that network I’m able to target the brokers that have these very qualified investors and also you know working with the investors I worked with which I work with a lot of private non institutional loaners and then across South Florida. Mostly in the 1 to 5 million dollar range smaller you know multifamily properties.
Jim Fried: That’s big to me.
Mitash Kripalani: Well you know I hope to go bigger, I hope to do number like yourself or someone the brokers you’ve had sitting in this chair before me, you know?
Jim Fried: Well Mitash you really do the CCIM’s well and you know you make me feel almost embarrassed because you’re very sharp you man.
Mitash Kripalani: Thank You.
Jim Fried: You know you’re very accomplished within the, what you’ve been trying to do. You’ve got a beautiful family that you’re growing. What advice would you give to a young person that’s considering going in to commercial real estate; they want to have a career. Talk to me like a CCIM, you’re on the board of directors at a local CCIM.
Mitash Kripalani: Yes, yes.
Jim Fried: I make them believe I’m a young person we’re going to talk about it later in the show about how somebody can go out and build a career get a job. What would you tell somebody that’s seeking to have a career in commercial real estate about the CCIM’s and Douglas Elliman?
Mitash Kripalani: Sure Jim. The best advice I can give a young broker starting out, the advice that they gave me was invest in yourself, invest in education yourself because what you’re selling and what you’re really have to offer your clients out there is your knowledge and your expertise. So don’t be afraid to get involved in whatever skill you want to develop, find an organization that does it. To me the CCIM is the best of the best because of have a great balance of technology and marketing and education. We have a really good class Jim coming up in August 10th. It’s the C101 which is basically a intro to the financial analysis and it teaches you how to use the cash flow models, the cap rate IRR’s.
So this is a great entry point and a segue in to the world of CCIM’s for anybody that’s looking to learn about our tools and technology, so this is a great class for anybody looking to learn more. We meet once a month at Vienna Capris at Coral Gables it’s a open meeting it’s you know I encourage any young brokers that want to see what we’re about and what we have to offer, just stop by. You know I personally for the last couple of years before I became a CCIM I would go this room and just sit there and listen to these veteran brokers and the deal exchange and the networking that goes on here. And I learned a lot being in that room so anybody that’s looking to get involved you know please come join us or reach out to me I’ll be happy to guide you through.
Jim Fried: Okay so we’ve got a couple of minutes left Mitash. Talk about how people can reach out to you and more importantly that, we’ll do that in a second everybody get your pencil ready we’ll talk to Mitash about his contact information in a minute. What is your opinion on the multi-family market? Miami Beach, what’s going on in Miami Beach?
Mitash Kripalani: Miami Beach is a great multi-family market we get our, we get calls from a lot of our buyers from New York that are like; “hey can you find me a building in Miami Beach?” So there is deals out there there’s still a lot of opportunities out there, you just have to look a little harder and you have to you know invest a little bit more time bringing your clients some good choices.
Jim Fried: How about the edge water you know I know some people are now calling it Mid-Point on 79th Street? High five to Duran for coming up with Mid-Point.
Mitash Kripalani: Yes.
Jim Fried: I know that that’s an active area ECI just finished a very building there. They just opened up a new CVS, right?
Mitash Kripalani: Yes.
Jim Fried: What do you think about that market?
Mitash Kripalani: Edgewater’s great Jim, anything in and around the urban course just very very hot right now you’re seeing what’s going on in the My old district which is the Biscayne Boulevard, you’re seeing Wynwood, The Design District so all these things are emerging as you know these amazing new development destinations and then if you look a little bit out on the outskirts Allapattah, Little River, Lemon City. The urban course getting very active.
Jim Fried: You know but you’re mentioning markets that are in transition so what you go and do a deal in a market that’s in transition you have to be very careful.
Mitash Kripalani: Yes.
Jim Fried: You have to make sure you understand what you’re doing and what’s going on around you. I must say is that unless somebody’s an expert in the market, they’re not going to know.
Mitash Kripalani: Yes. Work with the local broker, work with the CCIM that specializes in the market. You know there’s a great, I’m not a big hockey fan but there’s a great quote from Wayne Gretzky that when asked why are you such a great hockey player, he said “because most people go where the puck is, I position myself to be where the puck is going to be”. So if you look at real estate and you see where the puck is and design district and when would, you know it’s there now but if you position yourself where the puck is going to be, that’s the emerging areas.
Jim Fried: Hashtag I love it that’s just awesome.
Mitash Kripalani: Thank you.
Jim Fried: Listen Mitash before we go I did promise to people would get your contact information, if somebody was to reach out to you and speak to you on the phone and I know that a lot of your clients are from New York so I won’t the insult the Jets fans this time.
Mitash Kripalani: Okay.
Jim Fried: I’ll insult somebody else. Talk really slow just in case some Atlanta Falcons fans listening.
Mitash Kripalani: Okay great fair enough. Well the best way to reach me is to give me a call directly my cellphone number is 786-271-5598, once again 786-271-5598. I can also be emailed as my first name Mitash, M I T A S H at CCIM.net. And I always respond to even those calls.
Jim Fried: But I’ll tell you why Mitash because you are one the young stars. Mitash is one of the young up and coming stars at the CCIM in general and you’re in Miami and particular if you do need to speak to somebody who knows what going on and who’s going to work really hard, I can tell you, you can’t go wrong if you call Mitash. Dee how much more time do I have, do I have time for Mitash? Oh Mitash got a little more time Mitash. Give it at your phone number, your email one more time and then Dee’s going to make me go.
Mitash Kripalani: Sure Jim, 786-271-5598 that’s my direct number and my email is my first name Mitash, M I T A S H at CCIM.net and I wanted to thank you for having me here you look great by the way you’ve lost a ton of weight, you look younger
Jim Fried: Thanks.
Mitash Kripalani: You look younger
Jim Fried: Thanks.
Mitash Kripalani: You’ve taken a few years off you know? It’s good to see you.
Jim Fried: Oh my God I’m blushing; you could see I’m blushing on the radio. Mitash, thank you so much Mitash Kripalani.
Mitash Kripalani: My pleasure.
Jim Fried: CCIM, Douglas Elliman commercial. One of the up and coming stars to South Florida real estate, we’ll be right back after this with Alex P. Cordia, we’re going to talk about the oil and gas market, stick with us this guy knows what’s what.[Commercial break]
Jim Fried: All right I want to thank Dee for getting the queue right there. Dee I swear someday somebody’s going to meet you and they’re going to go why does Jim Fried you know why does he do that? Why does he, you’re the greatest. That’s we just played an America’s we’re trying to keep with the holiday spirit we said celebrate now we’re going to play in America and when you’re looking to buy or lease a car you want to get every advantage that you can that’s why you have to check out Warren Henry, Land Rover, Range Rover, Infinity and Jaguar. They’re all exceptional cars, they all come with the Warren Henry advantage. That means complimentary dent repair, key replacement, first service and a personal assistant that you can call for anything anytime for four years, always the best price, always the best service, always Warren Henry.
Jim Fried: All right I’ve been waiting for this interview for a long time but before we start I want to thank Wendy Craft for putting me in touch with our next guest, Alexander Pickens Cordia. Alexander Cordia is the Vice President of Development at Republic Resources; he’s responsible for the creation and presentation to marketing and investing materials for the future drilling endeavors. He identifies prospective investors in various different markets. He raises capital for the completion of wells and speaks and investor conferences about the state of the oil industry and we’re going to hear what’s going on, right now in oil and gas. Welcome to the show Alexander Cordia.
Alexander Pickens Cordia: Jim how are you doing?
Jim Fried: I’m doing great Alex, how about you?
Alexander Pickens Cordia: Can’t complain interesting week for all us.
Jim Fried: Oh my gosh it sure was but down here we’re all really focused on is the fact that Jose Fernandez hit a home run in his return and D-Wade re-signed so we’re really excited back here. But you know tell us a little bit about what, what your perspective is in the oil and gas industry and maybe give our audience a little bit of understanding on where you’re coming from you know how you I got involved in the firm and things like that.
Alexander Pickens Cordia: Sure thing, well right now we kind of got turned on our head this week. We’re looking originally you know pretty consistent $60 dollar oil price in April and as you know it’s dropped one and a half percent just this week so we’re down to 56.50 at the end of the day. First week in 29 weeks as well that we’ve added rigs back in to the lineup and we had companies like Pioneer come out and say that they’re going to stack two more a month until middle of 2016 so I mean while we are, we’re out there drilling it showing good signs that people are interested in getting out there and drilling.
Jim Fried: Alex, Alex why do people care about how many rigs are going and what the price of gas and oil is? Why do people, what are the impacts?
Alexander Pickens Cordia: Sure, so obviously the more rigs that are out drilling holes the more oil and gas that you’re going to produce. In this day and age with the new technology that every well that’s drilled you can say pretty much beyond reasonable that you’re going to produce more oil and gas per well drilled and with that you’re going to flood that market with more oil and gas. However these wells also have pretty steep decline curves.
Jim Fried: What’s that?
Alexander Pickens Cordia: So while, sure, so what these wells are doing is you know the big ones that are producing you know 500 – 2,000 barrels of oil and gas a day of yeah oil and gas a day and over a short of period of time they’re going to start producing less and less of those on a daily basis just due to pressure alone. So what happens is you flood the market with oil and gas right away and then not as much coming up pretty quickly.
Jim Fried: Okay so what we really got is what we really got then is rat and the snake on supply basically? A big of chunk of supply that’s not going to be sustainable that’s hitting the market? Is that what caused prices to drop and now they’re coming up again?
Alexander Pickens Cordia: So the prices have dropped because the supply is so high, you know Cushing has been overloaded with oil. There was a conversation you know a couple of months ago people were wondering if we were going to have to move it to floating storage, that we were just going to run out which is not an issue that we’ve faced before.
Jim Fried: Yeah but now we’re, aren’t we the number one producer of petroleum products in the world?
Alexander Pickens Cordia: Kind of hard to believe, isn’t it?
Jim Fried: I mean gee, I grew up with that being the biggest problem in our whole geo political world and now it’s been turned on its head. But Alex let’s take a step back for a minute, you’ve got a perspective on the oil and gas industry I know you went to you know Georgetown, you know that you got a real good understanding you went to TCU. Help me understand where you’re coming from, why oil is so important to you, why are you an expert. I mean how did you get to the top of Republic Industries?
Alexander Pickens Cordia: Sure. So obviously it runs in the bloodline I heard you mention earlier the lineage, having a grandfather that you know is his name is preceded by a legendary oil man.
Jim Fried: Yes.
Alexander Pickens Cordia: You learn a lot throughout most of throughout the years, been around him I watched him he’s a tremendous role model and an inspiration not just in the oil and gas industry but as a person, as an entrepreneur, as an American and you know I just use much that I can to soak up his wisdom every single day. You know going to Georgetown I wasn’t really focused on oil and gas, a lot of it is, you know strictly business oriented there’s a whole lot of politicking that goes on because the proximity to the capital. There’s a huge interest of people looking to go in to government in some capacity you know by way of Georgetown. But when I got to Texas it was pretty quickly evident that this is what I need to do, there was, there is no way that oil and gas will ever be irrelevant especially in United States, we’re the number one consumer of oil and gas in the world than we were a fraction of the population. It’s so important to us that drives everything and so there will always be a demand, there will always be a market and it’s the life blood of the United States.
Jim Fried: Well I think just about every American would agree on just about everything you said and in fact your grandfather came out for alternative energy solutions a few years ago I’m right there with him, you know the cheap oil kind of put that on the sideline for now but with that oil being so cheap why should somebody begin investing in oil and gas now?
Alexander Pickens Cordia: Well you got to pick your spot. The industry have a lot of places where it is for a lot of money to be made but there’s also a lot of money to be lost. So this will all comes back to rig count, you’ve got all these rigs that have been weighed down. When you look at back at October, whatever that was eight or nine months ago you got 1600 rigs operating in the United States. Today we’re down to I believe 620, 640 I think 620. That’s 60% of the rigs that have been laid down that means that there’s 60% of that work force that is, is not currently working. They’re looking for work and so it, you know they charge money to go out and drill those holes and no one’s out drilling it.
Jim Fried: Well.
Alexander Pickens Cordia: So they’re working for pennies on the dollar and so what you’re seeing now is you’re cost of going out to drill which you know take a well that costs 5 million dollars back when we had 1,600 rigs running, that costs about 3.5 million dollars now so it’s much much more economic to go out to drill the same hole, yes the cost of the price of the barrel is a bit lower but what we see here is if we get back up to $70-75 oil by the end of the year there’s what even more a potential upside, you’re return on investment is potentially much greater.
Jim Fried: Now Alex we have to go to a break can you hang on for a couple of minutes as we round the half time, do a little traffic and then come back?
Alexander Pickens Cordia: You got it.
Jim Fried: All right, thank you so much. We’ll be back with Alex Cordia, he is with Republic Industries the big endeavor out of Texas, we’re talking oil and gas, and we’re talking the family business with Alex. We’ll back after this with more oil and gas and after that I’ll talk about how to find your career. Dee take it away.[Commercial break]
Jim Fried: All right we’re back and hey Dee I heard in the traffic and I thought would be off the roads for the holiday, what’s going on out there? I guess.
Dee: It’s Miami bro.
Jim Fried: I hear you, I hear you. Hopefully it will calm when we’re on our way home tonight.
Dee: Oh yeah.
Jim Fried: All right, All right.
Dee: This is not L.A. you know L.A. has traffic at five in the morning; it’s three in the morning.
Jim Fried: All right I’m glad I don’t live in L.A. it looks like we’re headed that way though? All right Dee that’s it we’re done.
Jim Fried: You’re the man. Happy Fourth of July.[Commercial break]
Jim Fried: All right we’re back we’re with Alexander Cordia. He is one of the young rising stars in the oil and gas business recently out east to learn business came back to Texas realized that petroleum was in his blood, welcome back Alex.
Alexander Pickens Cordia: Glad to be back.
Jim Fried: All right, All right now listen Alex we talked about the price of oil is going to down but the price of production is going down too. I’m in real estate, we know that when everybody’s running away that’s the time to run in, it’s time to get in. Whereas the young man said before in our first segment, hey Gretzky always said he’s not going where the puck is he’s going where it’s going, sounds like you got the same approach to oil and gas.
Alexander Pickens Cordia: That’s exactly right.
Jim Fried: Now what do you see coming up, you know we talked about the fact that it’s a good time to invest right now, how does somebody assess risk when they’re looking at oil and gas?
Alexander Pickens Cordia: Sure. The first thing you want to look at is, well one you got know that where you’re going to be drilling there’s oil. That’s bottom line.
Jim Fried: Well, well okay.
Alexander Pickens Cordia: Second is that who is the guy that is going to be drilling it for you, who’s the operator, who’s he working with, what kind of team does he have, are they smart, what their success rate, you know how good are they at their job. And there’s a couple of different ways to look at it, one you can just look at the fact sheet, their resume and find out how much they’ve spent, what their predictions were, did they hit those numbers. The second thing what something I like to look at when I’m assessing, operators, EMP guys is what their lives look like outside of the office and you can kind of tell how good they are at their job and what their priorities are based on how they interact with their families. You know do they have kids, are they involved in their kid’s lives and it sounds like it’s completely unrelated but what I gathered from that is they are honest people.
Jim Fried: Oh Alex, oh high five in fact whenever I am with you to talk about it when I look about what when I talk about hiring people I look social, I look at their social.
Alexander Pickens Cordia: Absolutely and it’s important you know there’s that term “Snake oil salesman” and there are a lot of them and unfortunately they leave a taste in the mouth of investors that took a risk, got in to the industry and they got burned so bad that they’ll never get back in to it again. And that’s what you want to avoid, you don’t want to leave that taste in to the investor’s mouth. You want to return their money to them when you say you’re going to do and have the track record to prove it. Do accidents happen, of course. Is there an inherent risk in the industry, of course. But you can head your bets on that by looking at who’s doing the job for you.
Jim Fried: You know listen you know I have a series 22 and a series 63 so I don’t want to say that I got trained in doing due diligence but they did teach us to ask some fundamental questions about the people that we were going to be selling some oil and gas stuffs so Alex it sounds to be like I want to be in your camp. It sounds to me like you know exactly the real due diligence spots it’s just not about how successful they’ve been it’s how successful they’re going to be and a great predictor of that is who are they?
Alexander Pickens Cordia: That’s absolutely right and a lot of occasions you’re investing in people when you look at in oil and gas investment.
Jim Fried: You know we do the same thing we invest with operating partner’s sounds like you do the same thing so what your firm is really a capital source for the drilling people?
Alexander Pickens Cordia: So what we do is, we’re an operator we will take the capital from an investor, from a private equity firm wherever the source may be and then deploy that capital in to a variety of service companies from you know the guys that are going to be physically doing the rig works to the ones that are setting up tank batteries running pipe whatever it may be. And then we stay on top of them so we are potentially the managing or you know managing eyes over the entire project make sure that we are hitting all of our goals.
Jim Fried: Now what are your goals? How do you set them? How do you figure that out?
Alexander Pickens Cordia: Well they’re constantly evolving you know as we watched these service practice falls we have to re adjust our numbers practically on a daily basis and so we set our authority for expenditure while we think the price is going to be to drill that hole and complete it then we build in a 10% contingency on top of that just a cushion in the event that something happens down hole. And that’s what we pitch you know we show our track record in the field that we’re looking to drill as to what our numbers have been in different environments mind you be it the wells that we’ve drilled historically have been during the boom so those were when, you know fracking companies could come out and say you know demand is so hot for our work right now we can jump our prices by 50% and there weren’t really anything you could do about it. It’s an inverse industry today.
Jim Fried: Alex, what is your targeted return on costs when you evaluate one of your holes? I just have to ask because we look at that when we talk about a real estate deal, so to me it’s the same thing.
Alexander Pickens Cordia: Absolutely, so it’s yes in the oil industry it’s called “pay out”, and we want that to be under two years. What we’re looking at right now in this market on the wells that we are looking to drill pay out anticipated at $60 oil to be anywhere in the vicinity of 14 to 18 months.
Jim Fried: So when you say “pay out” that’s break even?
Alexander Pickens Cordia: That means if you give me a million dollars I’d give you a million dollars in 14 to 18 months.
Jim Fried: And then after that it’s just flows.
Alexander Pickens Cordia: Mailbox money.
Jim Fried: Oh my God. I love the way you say that, mailbox money. Talk dirty to me some more. Now what is the average, let’s say you drill a hundred wells. Dee how much time do we have left because I’m starting drift in to the really, okay good we got a couple more minutes left. How do you, what’s a good hit rate for wells? You drill a hundred how many need to come in for you to be good? You know 300 hitter?
Alexander Pickens Cordia: Wow that’s a tough question, it really depends what your economics are. If you are drilling seven million dollar holes that are producing 1,500 barrels of oil a day those are going to pay out pretty quick so you can make, you don’t have to hit quite as many of them. But that being said it really depends on your economics. I think you want to have a bare minimum of 70% success rate.
Jim Fried: Okay, now we talked a little bit about how the fracking’s come in that it helps the oil come out the oil kind of comes out fast, I think you indicated that those wells may run out a little faster so we got a hundred years of being in the top petrol chemical producer again, where are we? What do we got, how much do we got on the ground?
Alexander Pickens Cordia: We’ve got more natural gas in anywhere in the world.
Jim Fried: Oh I’m feeling strong.
Alexander Pickens Cordia: We’ve got another hundred maybe two hundred years of natural gas left.
Jim Fried: Oh say that to the guys negotiating to the Iranians.
Alexander Pickens Cordia: That is us producing like crazy. Now you see the promotion of the battery and how much more the battery has gotten in transportation, of course it’s not powerful enough to do anything like an 18 wheeler but you know in terms of, you know you and me getting around the battery is pretty much functional and you’re seeing other resources and other forms of energy build into that as well be in you know natural gas is making a big push in the transportation industry.
Jim Fried: Yeah but you still have to produce the electricity to do the car and I got to believe I think it’s a net zero. Listen we’ve only got like a minute left Alex. What’s your take away in the if people want to come you know find you, how do they find you?
Alexander Pickens Cordia: How do they find me?
Jim Fried: Yeah give me a take away too, give me a take away first.
Alexander Pickens Cordia: Like the last I can give you my cellphone number and my email?
Jim Fried: Well if that’s something you want to do or look you up on Linked In or something that’s where I found you.
Alexander Pickens Cordia: Absolutely in Linked In my name is Alexander Pickens Cordia. I can be Googled and my name will pop up on a bunch of different places. I can also contact us through the office at Republic Resources, that’s republicresources.com. Reach out to us and you can talk to me or anyone else that I work with we’re all I like to think a bunch of smart guys.
Jim Fried: Yeah. Well listen Alex Cordia, Alex P. Cordia, Alex Pickens Cordia if I’m really going to out you there, thanks for calling in great to have somebody with oil in their blood. Got to have you back, you mind being our regular expert oil and gas?
Alexander Pickens Cordia: I would love to be your regular expert.
Jim Fried: Well then we’re going to have some fun, got to get you down here, got to get you to South Beach. We’ll be following up but thank you so much Alex and again I want to thank Wendy Craft for helping us with the introduction to Alex P. Cordia our oil and gas expert.
Alexander Pickens Cordia: Yeah I appreciate it.
Jim Fried: It’s my pleasure. Have a great holiday we’ll be back after this I’m going to give some tips that I give to people everyday about how to get a career, it’s been successful, I’ve helped scores of people improve their career lives, listen in you’ll hear back after this again. High five to Alex, Dee it’s yours.[Commercial break]
Jim Fried: All right we are here, we are in the fourth quarter. I want to give a high five to the Miami Heat for signing D-Wade to a one year 20 million dollar contract. Thank you Mickey, thank you Pat and thank you D-Wade also I want to give a high five to Jose Fernandez that guy I think he hit a home run today I mean geez where did he come from? Thank you everybody. But today we’re going to talk about at the fourth quarter we’re going to talk about careers. I was on Facebook a couple of weeks ago people asked me if I would start giving some positive energy talks on the show so I’m going to start doing that. We’re going to start off with career, how to get a career. When folks come to meet me to help them get a job, this is what I, this is the process they go through.
First of all the person comes in they need to be clean and wearing a coat and tie sharp as a penny doesn’t matter if your office is always casual if you’re going out there look sharp as a tack because that’s what people are expecting and be positive. If you come in there and you’re wearing a suit and you’re on time but you’re negative, you aren’t going to win. No one wants negative energy in their firm and the other thing is make sure you know who you’re meeting with if you come in and you don’t know who I am, boy are you a loser. Because I’m everywhere, just Google Jim Fried and I’m not trying to be full of myself it’s I’m out there you should know who you’re meeting with. I know that when I meet with somebody I know who they are, I go to Linked In. For crying out loud it’s the easiest thing in the world and the by the way that’s transitional because Linked In, Facebook, Twitter, wherever you’re going to interview, they looked you up.
If you’re in that room they’ve already checked out your social media and you heard earlier Alex Cordia, Alex Cordia was talking about the fact that they always on social and the background of the people that they’re going to invest in when they drill an oil well and you know the other thing that you need to do is get the book of less and I like to find out who the person’s trying to meet and why because if they can tell me who they want to meet and why it gives me an idea of what type of career they want. If they don’t have any idea well here, here’s the book of lists call me in a couple of weeks then I asked them to please pick the firm tell me why and then I ask them to write a letter specifically to the person that they want to meet. While they’re doing that it makes them think about it some more so by the time I’ve got the letter and I’m going to flip it to somebody I know.
The person that I know that I’m giving the referral to knows that I checked out the person, met with the person, put the person through the ringer and that they’ve earned my respect enough so that I’m going to refer them to somebody and that’s what you’re looking for. You’re looking for somebody that’s going to give you a warm reference to a career, a person that’s going to be able to help in their career. And how do you know who knows who you want to meet? Social media, Linked In, Facebook go check out see if people know each other, get in the mix. Now, it doesn’t matter if you’re in Tampa, Orlando, Atlanta, Miami. I’ve helped people get careers started in Atlanta with Duff and Phelps in New York with Cushman and Wakefield, in Washington DC with some top appraisers, here in town with all of the big firms.
But I want to tell you story was a young and was going to meet me for coffee, he never showed up for coffee. Couple hours later he called me and says that he was drunk, got drunk. That’s why he missed the meeting with me and I said, “Dude you can forget it”, and I hung up the phone on him. We ran in to each other at a networking event a little while later he really apologized and he asked if I’d give him a positive reference to somebody I knew. He specifically asked can you give me a referral to so and so. I said I’ll call so and so and I’m going to tell him exactly what happened and I did. And the gentleman got the job at the wing it and today he’s got a fabulous career with one of the big investment banks. He was strong enough to come up admit he made a mistake and apologized.
Number one just be truthful and honest and other times somebody called me up and they said, Jim I’m about to start at a really good company here in New York but I just got a call from the head of appraisal that one of the big firms it’s my dream job, call the job that you’re going to start with. If he doesn’t appreciate the fact that you’re going to go interview for your dream job, he’s the wrong guy anyway. They use to come, they still do from the University of Florida and other points and they come in a car five or six people at a time sometimes. And they come in and they say, Mr. Fried how do we get a job I go well all six of you don’t get the same job you’re not the same person. This person might be a sales person, this person might be an under writing person, this person has a lot of money and a big tolerance for risk maybe that’s the developer in the team but you’re not all the same.
Another person that came to me was terrific, he had worked with one of the smaller firms in town. Went back got his real estate degree comes to me Mr. Fried I’d like to work for so and so I said well give me a letter. He gave me a letter, I sent it to so and so, so and so says listen we’re not hiring anybody I said take the meeting anyway, even if you don’t hire the guy you’re going to want to be able to refer him to somebody because you’re going to say, hey I met the guys he’s a good guy. Well my client’s wife was at the office that day, when she saw Mr. new shiny penny come in she goes who’s that? My friend said oh he’s somebody interviewing for the job, what job there is no job here. He goes well I would consider maybe he’d be my associate and I could get home a little earlier from the office, bang. The wife hired him on the spot.
So make sure you do these kind of things, it’s always important and one of the most interesting things that I’ve seen lately is the theory of the rich Chinese that goes to U.S., gets a degree and takes it back to China. You know they’re taking back our technology. So let’s go through some of the things, you got to make sure you know who you’re meeting with, you got to make sure you’re positive, you got to make sure you’re dressed up right. Dee how much time do I have left? Fine I got plenty of time. You got to make sure you know where you want to go and the by the way the presentation of yourself in Atlanta is different than in New York. In New York you may wear an Hermes tie in Atlanta you may wear something from Brooks Brothers. Always wear something that’s classy, positive and clean.
Now, social media review we talked about that. If you want to get career advancement maybe you want to get an advance degree like the Master’s in real estate at the University of Florida or an MBA from FIU but you got to be relentless. You‘ve got to be balanced, you’ve got to keep your eye on the future and the most important thing is mentorship. Find somebody to mentor you, we have the folks on last week that talked about executive coaching if you’re going to do a mid-career change maybe one of the executive coach. But the number one thing you need is somebody that’s honest. Somebody that’s going to be your friend and tell you what’s what and if you’re not sharp they got to tell, if you need to polish up this or that they got to tell you and make sure all of your social media is current, your Linked In is perfect, your Facebook is clean of any you know, no drinking and no other stuff on that. Twitter not any talking about you know untowardly social things, I’m not going to mention any of the words. Dee thought, I was getting close Dee, I was getting close but I’m not going to talk about the words.
People know the words and that more than this seven words that I can’t use on the “beep” show, okay. But I love my show, I love Dee if you, Dee is cracking up I’m going to give Dee a high five. They do good today then help people how to get a job Dee? I thought I did okay.
Dee: You did, yeah you’re doing a great job.
Jim Fried: Thank you. Personal, positive attitude to stay clean. I want to thank our sponsors; KIND snacks, South Florida Business and Wealth magazine, the CCIM’s, Mitash was great. What a great, Frank Melo’s sends us the greatest guys, Frank Rodriguez Melo thank you for sponsoring the show the CCIM’s. Terek Maddox, UHealth, Warren Henry Automotive another car out this week. NFL Alumni, the Miami Dolphins, Social Media 305, The Miami Marlins, Lauren’s Kids, The Aztec Group, University of Florida Bergstrom Center for Real Estate Studies, UHealth that’s University of Miami Health System but the most important person and people I want to thank are our listeners, I know you’re out there.
You know I’m thinking of changing the end of the show to playing “We are a family”, think about that Dee because they played that thing about Jim and don’t mess around with Jim but part of what I want to put out there is that we’re family, me, you, Wanda, Johnny social media, our listeners especially you’re family to me so go to our Facebook page like our show, tell you friends and give me some feedbacks, comments tell me who you want to hear from. You can tweet at me at Jim Fried the shows at Jim Fried at business I’m on Facebook, Linkedin, Youtube, the website the hits are going up.
Thank you to Robert Pitts for that, if you missed the show as soon as Dee gets it to me I’ll get it to Robert Pitts and it’ll go up probably tonight or tomorrow. We run it out as a second run on social media Sunday mornings so look for it then. This is Jim Fried for Fried on business we’ll be out on 880 next Thursday at six because I just love doing this. Remember that this is not a rehearsal this is your life, the person who wants to do something finds a way the other finds an excuse now go out there and enjoy the holiday weekend and make it happen everybody. Thank you, thank you everybody. Thank you.